Yale University prepares for endowment tax

The Yale Daily News reports:

As the University endowment reaches a record high, administrators are grappling with the impact of a new endowment tax on the operating budget, a reality that became all the more clear as the University released its annual endowment returns last month.

The 1.4 percent excise tax on annual endowment returns was enacted in the 2018 federal budget bill and targets 35 colleges and universities with assets greater than $500,000 per full-time student. Yale, with assets that total $2 million dollars per enrolled student, will have to pay an estimated $30.8 million on its 2018 endowment returns, based on calculations by the News. The new tax on what were previously tax-exempt institutions takes effect for fiscal years beginning after Dec. 31, 2017.

“The federal government is still in the process of clarifying a number of the provisions of this new law,” Vice President for Finance Steve Murphy told the News. “While this means we do not know the impact with certainty, a number of items will negatively impact the University’s finances — including the [endowment tax]. We are actively monitoring and planning for the implementation of this new law.”

The taxing of the socialists begins.... Couldn't happen to a nicer bunch.