Race Conscious Affirmative Action by Tax Exempt 501(c)(3) Institutions After Students for Fair Admissions v. Harvard and UNC

In 1983, several years after its 1954 decision in Brown v. Board of Education, the United States Supreme Court decided a case that significantly impacted tax-exempt § 501(c)(3) charitable schools that consider race in making admissions decisions. In Bob Jones University v. United States, the Court held that a private school that discriminates against African Americans in admissions is not entitled to § 501(c)(3) tax-exempt status. The Court based its decision on the public policy doctrine, an off-shoot of the well established illegality doctrine. Pursuant to the public policy doctrine, the Court upheld the IRS’s decision to deny § 501(c)(3) tax exemption to a private school because its actions violated clear, established public policy. Among the many determinants of established public policy is constitutional law doctrine. Thus, since the Court held for decades that discrimination against African Americans in school admissions violates the Fourteenth Amendment’s Equal Protection Clause, the Court naturally concluded that a private school engaged in such discrimination is not entitled to § 501(c)(3) tax exemption.