Private Schools In Danger of Losing Tax Exempt Status

Chicago Contrarian has the details. Chicago Private Schools Discriminated for Years to Further DEI and Now the IRS Wants Its Money Back

This story is about private schools in Chicago, but it applies nationwide.

Private schools that are tax exempt are in some trouble. They have been following the strictures of DEI, both in the classroom, and in hiring and pay. This is a problem. Or a potential problem anyway, as the US Treasury is proposing to crack down on DEI.

The proposed regulation (REG-119986-25) observes that a private school is not operated for charitable purposes if it "adopts, maintains, or enforces any policy or practice that discriminates on the basis of race, color, or national or ethnic origin" in any educational policy, admissions policy, scholarship program, athletic program, "or other school-administered or school-supported program."

"The operative concept here is 'any purpose,' and good intentions are not an excuse," the donor suggests. The proposed regulation suggests that racial discrimination in education is against fundamental public policy "regardless of the intent behind it," including where it is "defended as serving remedial or diversity-related objectives."

The National Association of Independent Schools is behind the pushing of DEI, and the number of schools, as estimated by the Treasury, is surprisingly large. Or maybe it is not so much of a surprise.

Schools that fail lose exemption for taxable years beginning after May 31, 2027. The IRS estimates 18,000 schools are in scope. These schools didn't all suddenly decide to start breaking the law individually. They followed their standards organization, the National Association of Independent Schools. NAIS is the trade group for Latin, Parker, Shipley, and hundreds of other private schools.

NAIS does not merely encourage DEI among its members. It embeds it in the "Principles of Good Practice", and membership in NAIS is contingent on agreeing to abide by them.

18,000 schools seems like a lot. That is more than half of all private schools in the US. (see National Center for Education Statistics.)

But really, I am not surprised that an alliance of educators is all in on DEI.