Educational Institutions – posting your nondiscrimination policy on the homepage
As many educational institutions are finalizing their Form 990 for tax years ending in 2022, this might be a helpful reminder for your Schedule E reporting.
The Internal Revenue Service issued a long-awaited update in 2019, Revenue Procedure 2019-22, regarding publicizing your educational institution’s racial nondiscrimination policy.
A college, university or independent school is required to have a racial nondiscrimination policy with regard to students in order to qualify as a tax-exempt organization. This means adopting a policy, operating the nondiscrimination policy in a bona fide manner, and making it known to the general public.
To satisfy the publication requirement institutions no longer need to take out advertisements in the local newspaper to provide notice, or to use broadcast media, as long as the nondiscrimination policy regarding students is posted on the website homepage. The newspaper notice and broadcast media had been the two prescribed methods of publicizing the policy to the public since 1975 when Revenue Procedure 75-50 was published, despite technological advances.
If your educational institution takes advantage of this guidance, you will want to ensure that the notice on your institution’s website homepage follows the rules in Revenue Procedure 2019-22 to be considered publicly accessible.
The IRS guidance says that just having a link on the homepage to another page where the notice appears is not acceptable.
Here are checklists for putting the notice on your homepage website:
Do:
- make the notice unavoidable
- make it accessible without a visitor needing to enter an email address, username or password
- make it the same size, color and graphic treatment in relation to other parts of your homepage
- make it visible without having to do anything but simply scrolling on your homepage
Don’t:
- have other parts of your homepage distract attention from the notice
- have to link to another page from your homepage
- have to select a dropdown or access by hovering
- have notice in a carousel
Here is the sample policy wording that the IRS has published:
NOTICE OF NONDISCRIMINATORY POLICY AS TO STUDENTS
The M school admits students of any race, color, national and ethnic origin to all the rights, privileges, programs, and activities generally accorded or made available to students at the school. It does not discriminate on the basis of race, color, national and ethnic origin in administration of its educational policies, admissions policies, scholarship and loan programs, and athletic and other school-administered programs.
The IRS’s antiquated rule from the 1970’s was finally updated! But please make sure your policy notice follows the dos and don’ts!
If you have any tax questions regarding colleges, universities or independent schools, please contact CLA’s Sarah Hintz at Sarah.Hintz@claconnect.com or Laura Kenney at Laura.Kenney@claconnect.com.
Laura enjoys providing tax services for public charities, higher education institutions, private schools, cultural institutions, associations, foundations and healthcare organizations.
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