Harvard Hotel Draws Scrutiny As IRS Audits 30 Colleges

Harvard University owns a hotel overlooking the Charles River that charges as much as $300 a night for a room. Yet the country’s richest higher-education institution doesn’t pay a cent in taxes on revenue from the property in Boston and hasn’t for at least five years. Now, the federal government wants to know: are taxpayers getting shorted?

Not-for-profit universities are exempt from paying taxes on tuition or other money that relates directly to their educational mission. Still, the government has long required all nonprofits and even public schools to pay on a class of revenue known as “unrelated business income.” That’s a broad category, encompassing revenue from college-owned bookstores, restaurants, sports arenas, and other venues when they sell goods and services to the public.     Read More