Bill > HR1128

This bill, known as the Endowment Accountability Act, proposes significant changes to the taxation of private colleges and universities by increasing the excise tax rate on their investment income from 1.4% to 10% and lowering the asset threshold that determines which institutions are subject to the tax. Currently, private colleges and universities with assets over $500,000 per student are taxed on their investment income; this bill would reduce that threshold to $200,000 per student, meaning more institutions will be required to pay the higher tax rate. The modifications would apply to taxable years beginning after the date of the Act's enactment. The purpose appears to be to increase tax revenue from wealthy educational institutions and potentially encourage them to spend more of their endowment funds on educational purposes by making the tax more financially consequential.