Wall Street Journal

Which Colleges Will Have to Pay Taxes on Their Endowment? Your Guess Might Not Be Right

January 18, 2018

The Juilliard School, New York’s magnet for aspiring artists, is bracing for a 1.4% tax on income from its $1 billion endowment. Three miles away, Columbia University and its $10 billion endowment will remain untouched for now.  A college-endowment tax, enacted in December in the Tax Cuts and Jobs Act signed by President Donald Trump,  is causing confusion and frustration at schools across the country, which rely on the previously tax free-earnings when setting their budgets. Small liberal arts colleges will likely be hit disproportionately because many have sizable endowments but limited enrollment. The tax applies only to private schools with at least 500 students and at least $500,000 of investments per student.

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