Concept

Endowment excise tax

Federal tax on the net investment income of certain private colleges (26 U.S.C. § 4968), created in 2017 and widened in 2025.

2 links, 2 backed by primary records

Enacted by Public Law 115-97 (Tax Cuts and Jobs Act) at a flat 1.4 percent, and rewritten by Public Law 119-21 (2025 budget reconciliation act) into rates of 1.4, 4 and 8 percent by endowment per student.

Connections 2

Public Law 115-97 (Tax Cuts and Jobs Act) Primary record 1
Public Law 119-21 (2025 budget reconciliation act) Primary record 2
Section 70415 replaced the flat 1.4 percent with 1.4, 4 and 8 percent tiers, by endowment per student.

Proof 2 sources

Public Law 115-97 (H.R. 1), the Tax Cuts and Jobs Act, section 13701, U.S. Government Publishing Office, 22 Dec 2017. Primary record
There is hereby imposed on each applicable educational institution for the taxable year a tax equal to 1.4 percent of the net investment income of such institution for the taxable year.
Public Law 119-21 (H.R. 1), the 2025 budget reconciliation act, section 70415, U.S. Government Publishing Office, 4 Jul 2025. Primary record
8 percent in the case of an institution with a student adjusted endowment in excess of $2,000,000

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