TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

A Member of the Law Professor Blogs Network

Thursday, April 19, 2012

NY Times Debate: Do Wealthy Colleges Deserve Their Tax Breaks?

Room for Debate New York Times, Room for Debate: Do Wealthy Colleges Deserve Their Tax Breaks?:

In a recent op-ed column, Richard Vedder of the Center for College Affordability and Productivity ... pondered the fairness of tax breaks for a wealthy university like Princeton, while a state institution like the College of New Jersey begs for funding. His comments raise a good question: Should government change its tax exemption policies for universities as a way of equalizing educational resources in America?

http://taxprof.typepad.com/taxprof_blog/2012/04/ny-times-1.html

Legal Education, Tax | Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341c4eab53ef01630479ef50970d

Listed below are links to weblogs that reference NY Times Debate: Do Wealthy Colleges Deserve Their Tax Breaks?:

Comments

Well, all I know is that it certainly isn't fair. That is the tax "standard" we use now right? Fair. (And no I can't define it, but I know fairness when I see it.)

/sarc

Posted by: Over50 | Apr 20, 2012 7:48:14 AM

What are th breaks colleges get? No tax on capital gains in their endownment? No tax on distributions from their endowment?

Posted by: buck smith | Apr 20, 2012 8:04:08 AM

Just what Big Government needs, another revenue stream it can redirect and waste.

Posted by: Mackay Rippey | Apr 20, 2012 8:36:24 AM

Of additional interest might be Harvard Law Professor Daniel Halperin’s piece "Does Tax Exemption for Charitable Endowments Subsidize Excessive Accumulation?"

Posted by: David Powell | Apr 20, 2012 8:42:55 AM

Buck Smith,

I'm guessing that donations wouldn't be tax deductible if the University's endowment exceeded some benchmark. That may dis-incentivize some people from donating.

Posted by: Half Canadian | Apr 20, 2012 9:05:30 AM

Don't forget the university/college property tax break - they pay none.

Don't forget the university/college sales tax break on their sale of instruction - they pay none.

Don't forget the university/college executive employee salary tax breaks with respect to expense report padding (six-start hotel stay vs Motel 6 stay, first/business-class travel vs coach class travel, etc) paid for out of endowment dollars

Posted by: RM3 Frisker FTN | Apr 20, 2012 12:00:38 PM

A big tax break is not paying property taxes. This is killing my small city with an Ivy League university, which owns property not only in the city, but all over the county as well. Given that Cornell has many businesses that are part of their educational facilities, but competes with small privately owned local businesses, I think it might be time to revisit this policy on a federal level.

Posted by: Robin | Apr 20, 2012 1:37:37 PM

One of the most harmful tax breaks is property taxes. Cornell University, in Ithaca, NY, pays almost no property taxes. As a result, a disproportionate share of the taxes falls on the residents, even though Cornell uses many of the services that are paid through by property taxes.

Posted by: Spero | Apr 20, 2012 3:25:19 PM

Fair?

Wouldn't it be fairest if there was a "From those according to their wealth to those according to their need education act" -- in which all that excess money that the Harvard's and Princeton's and Michigan's had was redirected to poor inner city elementary schools?

It would be all for the children, you know. . . . .

Posted by: Narniaman | Apr 20, 2012 5:32:35 PM