WASHINGTON | Nov. 4, 2026 – The Liberty Justice Center’s PARENTS Initiative (PARENTS) has submitted a public comment to the U.S. Department of the Treasury and the Internal Revenue Service regarding a proposed regulation titled “Racial Nondiscrimination in Private Schools.”
The proposed rule would make private schools ineligible for federal income tax exemption under Section 501(c)(3) if they discriminate on the basis of race, color or national or ethnic origin in admissions, scholarships, educational policies, athletics or other school-administered or school-supported programs. But this proposal lacks two important safeguards:
- An undefined standard: The proposal never defines “discriminates.” PARENTS’ comment calls for an express intentional-discrimination standard, drawing on Title VI, relevant court decisions and the administration’s guidance. Without that clarification, the rule could be interpreted to deny tax-exempt status based solely on unintentional disparate impacts.
- Religious protection absent from the regulatory text: The proposed rule’s discussion of religious protection appears only in the preamble. The regulation itself never mentions religion. Without express protection in the regulatory text, private religious schools could face uncertainty about whether their religious admissions policies jeopardize their tax-exempt status.
WHO: Timothy R. Snowball, Senior Attorney for the Liberty Justice Center’s PARENTS Initiative, is available for interviews.
PARENTS (Parental Action and Rights Enforcement to ensure Notice, Transparency, and Safety) is LJC’s first-line defense against the infringement of parental rights, including parents’ rights to be informed, to be respected and to make the best decisions for their children’s education and future.
HOW TO ACCESS THE SUBMISSION: PARENTS’ comment, submitted November 3, 2026, is available here.
The proposed regulations and related rulemaking materials are available through the Federal Register notice.
MEDIA INQUIRIES: For media interviews, please reach out to Neil Strauss at [email protected] or visit Media Inquiries.
ISSUE BACKGROUND: On September 4, 2026, the Treasury Department and the IRS published a proposed regulation addressing the racial nondiscrimination requirements private schools must satisfy to qualify for federal income tax exemption. PARENTS’ comment seeks clarification of the discrimination standard and express protection for religious schools in the regulatory text.
Under existing IRS guidance, private schools must maintain racially nondiscriminatory policies to qualify for tax-exempt status. However, portions of that guidance permit certain preferences for racial minority groups in admissions, programs and financial assistance. The proposed regulations would remove those provisions and specify that discrimination based on race, color or national or ethnic origin for any purpose is incompatible with a private school’s tax-exempt status. But the rule never specifically defines “discriminates” in this context, leaving the door open for “disparate impact” theories.
The proposed rule’s preamble states that it would not preclude schools from maintaining religious missions, curricula or observances, or selecting students based solely on religious affiliation or membership rather than ancestry or ethnicity. That protection, however, is not included in the proposed regulatory text, which never mentions religion.
If finalized as proposed, the regulations would apply to private schools’ taxable years beginning after May 31, 2027. The deadline for public comments was November 3, 2026.
Home > Liberty Justice Center’s PARENTS Initiative Submits a Comment on Proposed IRS Regulations Addressing Discrimination in Private Schools
Media Alert: Liberty Justice Center’s PARENTS Initiative Submits a Comment on Proposed IRS Regulations Addressing Discrimination in Private Schools
WASHINGTON | Nov. 4, 2026 – The Liberty Justice Center’s PARENTS Initiative (PARENTS) has submitted a public comment to the U.S. Department of the Treasury and the Internal Revenue Service regarding a proposed regulation titled “Racial Nondiscrimination in Private Schools.”
The proposed rule would make private schools ineligible for federal income tax exemption under Section 501(c)(3) if they discriminate on the basis of race, color or national or ethnic origin in admissions, scholarships, educational policies, athletics or other school-administered or school-supported programs. But this proposal lacks two important safeguards:
WHO: Timothy R. Snowball, Senior Attorney for the Liberty Justice Center’s PARENTS Initiative, is available for interviews.
PARENTS (Parental Action and Rights Enforcement to ensure Notice, Transparency, and Safety) is LJC’s first-line defense against the infringement of parental rights, including parents’ rights to be informed, to be respected and to make the best decisions for their children’s education and future.
HOW TO ACCESS THE SUBMISSION: PARENTS’ comment, submitted November 3, 2026, is available here.
The proposed regulations and related rulemaking materials are available through the Federal Register notice.
MEDIA INQUIRIES: For media interviews, please reach out to Neil Strauss at [email protected] or visit Media Inquiries.
ISSUE BACKGROUND: On September 4, 2026, the Treasury Department and the IRS published a proposed regulation addressing the racial nondiscrimination requirements private schools must satisfy to qualify for federal income tax exemption. PARENTS’ comment seeks clarification of the discrimination standard and express protection for religious schools in the regulatory text.
Under existing IRS guidance, private schools must maintain racially nondiscriminatory policies to qualify for tax-exempt status. However, portions of that guidance permit certain preferences for racial minority groups in admissions, programs and financial assistance. The proposed regulations would remove those provisions and specify that discrimination based on race, color or national or ethnic origin for any purpose is incompatible with a private school’s tax-exempt status. But the rule never specifically defines “discriminates” in this context, leaving the door open for “disparate impact” theories.
The proposed rule’s preamble states that it would not preclude schools from maintaining religious missions, curricula or observances, or selecting students based solely on religious affiliation or membership rather than ancestry or ethnicity. That protection, however, is not included in the proposed regulatory text, which never mentions religion.
If finalized as proposed, the regulations would apply to private schools’ taxable years beginning after May 31, 2027. The deadline for public comments was November 3, 2026.
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