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IRS Releases Interim Report on Nonprofit Colleges and Universities Compliance Project

The Internal Revenue Service released an interim report, with executive summary, summarizing responses to a questionnaire about nonprofit colleges and universities' tax law compliance. Colleges and universities make up one of the largest nonprofit segments in the country in terms of revenue and assets.

The report contains preliminary information on the respondents' organizational structures, demographics, exempt and unrelated business activities, endowments, executive compensation, and governance practices. Respondents are divided into three groups based on size of student population.

The report includes information on a wide variety of activities that might be exempt or taxable, depending on facts and circumstances. In most cases, the percentage of colleges and universities that indicated engaging in an activity was much higher than the percentage of organizations that reported treating the activity as taxable.

“That is one area we are going to focus on in our ongoing analysis of the data,” said Lois G. Lerner, director of the IRS’s Exempt Organizations division. “We need to understand if this apparent disparity is appropriate or whether it indicates a broader compliance concern in the unrelated business income area.”

Additional information will be made available as the IRS completes its analysis.

Additional information

News release 2010-58 (May 7, 2010)

Page Last Reviewed or Updated: 13-May-2014