PlainBillCongress, translated.Legislation. Context. Public interest.Referred to the House Committee on Ways and Means.
Congressional Research Service
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People & committees
Rep. Adams, Alma S. [D-NC-12] · D–NC
Legislative record
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Referred to the House Committee on Ways and Means.
Introduced in House
Introduced in House
Primary sources
Text links open the official source. We also preserved the text version used in the PlainBill explanation below.
No related bills are listed in this snapshot. This does not establish whether the proposal has appeared in earlier Congresses.
Source last updated: Oct 16, 2026. Consult Congress.gov for the current record.
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PlainBill explanation
Based on the full Introduced in House · 2026-09-10 text. This explanation has not received human editorial review. This overview describes the proposal’s major provisions; it does not establish what its real-world effects would be.
This proposal would place special limits on federal tax inquiries and examinations of colleges, universities, and their related organizations. It would require written reasons, advance notices, opportunities to discuss examinations, and deadlines for completing reviews. It would also restrict some tax assessments and repeat investigations. Criminal investigations, willful tax evasion, and knowing failures to file tax returns would be excluded from these protections.
The Secretary may begin a university tax inquiry only if the requirements of paragraphs (2) and (3) have been met.
The term university means— (A) any institution of higher education (as defined under section 102 of the Higher Education Act of 1965), and (B) any related organization (as defined under section 4968(g)(2)) of such an institution.
The Secretary shall complete any university tax inquiry or examination (and make a final determination with respect thereto) not later than the date which is 2 years after the examination notice date.
(iii) an offer to have a conference between the university and the Secretary in order to discuss, and attempt to resolve, concerns relating to such examination
This section shall not apply to— (1) any criminal investigation, (2) any inquiry or examination relating to the tax liability of any person other than a university, (3) any assessment under section 6851, 6852, or 6861, (4) any willful attempt to defeat or evade any tax imposed by this title, or (5) any knowing failure to file a return of tax imposed by this title.
any tax imposed by chapter 1 (other than section 511) may be assessed, or a proceeding in court for collection of such tax may be begun without assessment, only for the 3 most recent taxable years ending before the examination notice date.
no other university tax inquiry or examination may begin with respect to such university during the applicable 5-year period unless such inquiry or examination is approved in writing by the Secretary or does not involve the same or similar issues involved in the preceding inquiry or examination.
Section 1 would name the legislation the Higher Education Oversight for Nonprofits Ensuring Standards and Transparency Act.
This Act may be cited as the Higher Education Oversight for Nonprofits Ensuring Standards and Transparency Act.
Section 2 would add a new tax-code section governing university tax inquiries and examinations. Coverage would include institutions of higher education and related organizations as defined in other statutes. An inquiry would address whether income can be excluded from tax, whether the institution is tax-exempt, or whether its business or other activities are taxable.
by inserting after section 7612 the following new section: 7613. Restrictions on university tax inquiries and examinations
The term university means— (A) any institution of higher education (as defined under section 102 of the Higher Education Act of 1965), and (B) any related organization (as defined under section 4968(g)(2)) of such an institution.
The term university tax inquiry means any inquiry into a university (other than an examination) to serve as a basis for determining whether— (A) any income derived by the university is excludable from taxation under section 115, (B) the university is exempt from taxation under section 501(a), or (C) the university is carrying on an unrelated trade or business (within the meaning of section 513) or otherwise engaged in activities which may be subject to taxation under this title.
Before an inquiry could begin, a qualifying senior Treasury official would need a reasonable belief, supported by facts and circumstances recorded in writing, that the relevant tax exclusion or exemption might not apply, or that the university might have taxable activities.
(A) in the case of such inquiry serving as a basis for determining whether any income derived by the university is excludable from taxation under section 115, an appropriate high-level Treasury official reasonably believes (on the basis of facts and circumstances recorded in writing) that any such income may not be so excluded, (B) in the case of such inquiry serving as a basis for determining whether the university is exempt from taxation under section 501(a), an appropriate high-level Treasury official reasonably believes (on the basis of facts and circumstances recorded in writing) that such university may not be so exempt, and (C) in the case of such inquiry serving as a basis for determining whether the university is carrying on an unrelated trade or business (within the meaning of section 513) or otherwise engaged in activities which may be subject to taxation under this title, an appropriate high-level Treasury official reasonably believes (on the basis of facts and circumstances recorded in writing) that such university may be carrying on such an unrelated trade or business or engaged in such activities.
The term appropriate high-level Treasury official means the Secretary of the Treasury or any delegate of the Secretary whose rank is no lower than that of a principal Internal Revenue officer for an internal revenue district.
The university would have to receive written notice before an inquiry began. The notice would explain the concerns and subject matter, relevant legal provisions, and the right to a conference before examination of its records or activities.
before beginning such inquiry, the Secretary provides written notice to the university of the beginning of such inquiry.
The notice required by this paragraph shall include— (i) an explanation of— (I) the concerns which gave rise to such inquiry, and (II) the general subject matter of such inquiry, and (ii) a general explanation of the applicable— (I) administrative and constitutional provisions with respect to such inquiry (including the right to a conference with the Secretary before any examination of university business records or university activities), and (II) provisions of this title which authorize such inquiry or which may be otherwise involved in such inquiry.
An examination would have to follow an inquiry. Examination of business records would be limited to what is necessary to determine tax liability and the amount owed. Examination of university activities would be limited to determining a claimed income exclusion or tax exemption.
The Secretary may begin a university tax examination only— (i) following the beginning of a university tax inquiry under subsection (a) into the university to be examined, (ii) subject to subparagraph (B), and (iii) if the requirement of paragraph (2) has been met.
A university tax examination may be made only— (i) in the case of university business records, to the extent necessary to determine the liability for, and the amount of, any taxation imposed by this title, and (ii) in the case of university activities, to the extent necessary to determine whether a university claiming— (I) any income to be excludable from taxation under section 115 is so excludable, or (II) to be exempt from taxation under section 501(a) is so exempt.
Business records would mean regularly kept corporate and financial records, excluding records obtained through a summons covered by section 7609 or from a government agency. University activities would include academic and administrative operations, affiliations, ideological positions, advocacy, and teaching content, but would exclude business records.
The term university business records means all corporate and financial records regularly kept by a university. (B) Exception Such term shall not include records acquired— (i) pursuant to a summons to which section 7609 applies, or (ii) from any governmental agency.
The term university activities— (A) means any activities relating to the academic or bureaucratic operation of the university, including— (i) any affiliations or ideological positions of, or advocacy by, the university, and (ii) the curricular or scholastic content that the university provides to its students, but (B) does not include university business records.
An examination notice could not be sent before the 15th day after the inquiry notice. The university and the appropriate Internal Revenue Service Division Counsel would then need at least 15 days' notice before the examination began. A university requesting a conference before the examination would have to receive a reasonable opportunity to participate.
(A) at least 15 days before the beginning of such examination, the Secretary provides the notice described in paragraph (3) to both the university and the appropriate Division Counsel of the Internal Revenue Service, and (B) the university has a reasonable time to participate in a conference described in paragraph (3)(A)(iii), but only if the university requests such a conference before the beginning of the examination.
The examination notice described in this paragraph shall not be provided to the university before the 15th day after the date on which the university tax inquiry notice was provided to the university under subsection (a).
The examination notice would include the earlier inquiry notice, a description of the records and activities sought, a conference offer, and examination documents whose disclosure is required by the Freedom of Information Act. Division Counsel could submit an advisory objection within 15 days; the text does not make that objection a veto.
a written notice which includes— (i) a copy of the university tax inquiry notice provided to the university under subsection (a), (ii) a description of the university business records and university activities which the Secretary seeks to examine, (iii) an offer to have a conference between the university and the Secretary in order to discuss, and attempt to resolve, concerns relating to such examination, and (iv) a copy of all documents which were collected or prepared by the Internal Revenue Service for use in such examination and the disclosure of which is required by the Freedom of Information Act.
The Division Counsel of the Internal Revenue Service who receives an examination notice under paragraph (2)(A) may, within 15 days after such notice is provided, submit to the Secretary an advisory objection to the examination.
Once an examination properly began, the Secretary could examine records or activities omitted from the notice, provided the additional examination met the applicable necessity limits.
Within the course of a university tax examination which (at the time the examination begins) satisfies the preconditions of paragraph (1)(A), the Secretary may examine any university business records or university activities which were not specified in the examination notice to the extent such examination meets the requirement of clause (i) or (ii) of paragraph (1)(B) (whichever applies).
An inquiry or examination and its final determination generally would have to finish within two years after the examination notice. If no examination notice were issued, the inquiry and final determination would have to finish within 90 days after the inquiry notice.
The Secretary shall complete any university tax inquiry or examination (and make a final determination with respect thereto) not later than the date which is 2 years after the examination notice date.
In the case of a university tax inquiry with respect to which there is no examination notice under subsection (b), the Secretary shall complete such inquiry (and make a final determination with respect thereto) not later than the date which is 90 days after the inquiry notice date.
Those deadlines would pause during specified litigation or court-ordered restrictions, certain failures to provide requested information, and periods agreed to by the university and Secretary. The information-delay provision covers periods exceeding 20 days but not exceeding six months.
The running of the 2-year period described in paragraph (1)(A) and the 90-day period in paragraph (1)(B) shall be suspended— (A) for any period during which— (i) a judicial proceeding brought by the university against the Secretary with respect to the university tax inquiry or examination is pending or being appealed, (ii) a judicial proceeding brought by the Secretary against the university (or any official thereof) to compel compliance with any reasonable request of the Secretary in a university tax examination for examination of university business records or university activities is pending or being appealed, or (iii) the Secretary is unable to take actions with respect to the university tax inquiry or examination by reason of an order issued in any judicial proceeding brought under section 7609, (B) for any period in excess of 20 days (but not in excess of 6 months) in which the university or its agents fail to comply with any reasonable request of the Secretary for university business records or other information, or (C) for any period mutually agreed upon by the Secretary and the university.
Before denying an income exclusion or tax exemption, issuing a notice asserting additional tax owed, or making a covered underpayment assessment, Division Counsel would have to find substantial compliance with the procedures and approve the action in writing.
The Secretary may— (A) determine that— (i) any income derived by a university is not excludable from taxation under section 115, or (ii) a university is not exempt from taxation under section 501(a), (B) send a notice of deficiency of any tax involved in a university tax examination, or (C) in the case of any tax with respect to which subchapter B of chapter 63 does not apply, assess any underpayment of such tax involved in a university tax examination, only if the appropriate Division Counsel of the Internal Revenue Service determines in writing that there has been substantial compliance with the requirements of this section and approves in writing of such inclusion of income, revocation of status, notice of deficiency, or assessment.
For examinations concerning previously excluded income or revocation of tax-exempt status, covered income taxes generally could be assessed, or collected through a court proceeding without an assessment, only for the three most recent tax years ending before the examination notice. That window would become six years if, for any of those three years, the university had neither income qualifying for the section 115 exclusion nor section 501(a) tax-exempt status.
In the case of any university tax examination with respect to— (I) the inclusion under section 115 of any income previously excluded from taxation under such section, or (II) the revocation of tax-exempt status under section 501(a), any tax imposed by chapter 1 (other than section 511) may be assessed, or a proceeding in court for collection of such tax may be begun without assessment, only for the 3 most recent taxable years ending before the examination notice date.
If the university— (I) derives no income which is excludable from taxation under section 115, and (II) is not exempt from taxation under section 501(a), for any of the 3 taxable years described in clause (i), clause (i) shall be applied by substituting 6 most recent taxable years for 3 most recent taxable years.
For the section 511 tax identified in the bill as unrelated business tax, assessments or court collection proceedings without assessment would be limited to the six most recent tax years ending before the examination notice. Neither this rule nor the three- or six-year rules for exemption and income-exclusion cases would extend an otherwise shorter applicable deadline.
(B) Unrelated business tax In the case of any university tax examination with respect to the tax imposed by section 511, such tax may be assessed, or a proceeding in court for the collection of such tax may be begun without assessment, only with respect to the 6 most recent taxable years ending before the examination notice date.
Subparagraphs (A) and (B) shall not be construed to increase the period otherwise applicable under subchapter A of chapter 66.
If the government did not substantially comply with the notice, conference, or applicable approval requirements, a court proceeding to enforce a summons would have to pause until the court found that all practicable corrective steps had been taken. The inquiry or examination deadline would keep running during that pause. This would be the exclusive remedy for noncompliance with the proposed section.
If there has not been substantial compliance with— (A) the notice requirements of subsection (a) or (b), (B) the conference requirement described in subsection (b)(3)(A)(iii), or (C) the approval requirement of subsection (d)(1) (if applicable), with respect to any university tax inquiry or examination, any proceeding to compel compliance with any summons with respect to such inquiry or examination shall be stayed until the court finds that all practicable steps to correct the noncompliance have been taken. The period applicable under paragraph (1) of subsection (c) shall not be suspended during the period of any stay under the preceding sentence.
No suit may be maintained, and no defense may be raised in any proceeding (other than as provided in paragraph (1)), by reason of any noncompliance by the Secretary with the requirements of this section.
After a completed review produced neither a listed adverse tax action nor a request for significant operational changes, another review of the same or similar issues generally could not begin during the applicable five-year period without the Secretary's written approval. Reviews involving different issues would remain permitted.
If any university tax inquiry or examination with respect to any university is completed and does not result in— (A) an inclusion of income, revocation of status, notice of deficiency, or assessment described in subsection (d)(1), or (B) a request by the Secretary for any significant change in the operational practices of the university (including the adequacy of accounting practices), no other university tax inquiry or examination may begin with respect to such university during the applicable 5-year period unless such inquiry or examination is approved in writing by the Secretary or does not involve the same or similar issues involved in the preceding inquiry or examination.
The five-year period would run from the notice used to calculate the review's completion deadline, rather than from completion of the review. The bill's deadline-pause rules would apply. For repeat-review purposes, a review would count as completed no later than its applicable completion deadline.
For purposes of the preceding sentence, an inquiry or examination shall be treated as completed not later than the expiration of the applicable period under paragraph (1) of subsection (c).
the term applicable 5-year period means the 5-year period beginning on the date the notice taken into account for purposes of subsection (c)(1) was provided. For purposes of the preceding sentence, the rules of subsection (c)(2) shall apply.
A final Internal Revenue Service agent report would count as a Treasury determination under section 7428(a)(1). A university receiving it would be treated as having exhausted the available administrative remedies for purposes of sections 7428 and 7430.
Any final report of an agent of the Internal Revenue Service shall be treated as a determination of the Secretary under paragraph (1) of section 7428(a), and any university receiving such a report shall be treated for purposes of sections 7428 and 7430 as having exhausted the administrative remedies available to it.
Within 60 days after an inquiry or examination began, the Secretary would have to send a confidential report to the House Ways and Means Committee and Senate Finance Committee. It would identify the university, attest that the applicable starting requirements were met, and include the relevant notice and all finalized and officially proposed regulations interpreting and implementing the section.
Not later than 60 days after the beginning of any university tax inquiry or examination, the Secretary shall transmit to the appropriate congressional committees a confidential report that includes— (1) the identity of the university subject to the tax inquiry or examination, (2) an attestation that the requirements of subsection (a)(1) or (b)(1)(A) (whichever applies) have been met, (3) a copy of the university tax inquiry notice or the university tax examination notice provided to the university under subsection (a) or (b), respectively (whichever applies), and (4) a copy of all finalized and officially proposed regulations relating to the interpretation and implementation of this section.
The term appropriate congressional committees means— (A) the Committee on Ways and Means of the House of Representatives, and (B) the Committee on Finance of the Senate.
The proposed restrictions would not apply to criminal investigations, inquiries or examinations about the tax liability of a person other than a university, assessments under sections 6851, 6852, or 6861, willful attempts to evade tax, or knowing failures to file a tax return.
This section shall not apply to— (1) any criminal investigation, (2) any inquiry or examination relating to the tax liability of any person other than a university, (3) any assessment under section 6851, 6852, or 6861, (4) any willful attempt to defeat or evade any tax imposed by this title, or (5) any knowing failure to file a return of tax imposed by this title.
The bill would renumber the existing section 7613 as section 7614 and update tax-code references to point to the new university restrictions. The revised cross-reference provision would also include a reference to church tax-inquiry restrictions.
by redesignating section 7613 as section 7614
The table of sections for subchapter A of chapter 78 of such Code is amended by striking the item relating to section 7613 and inserting the following new items: Sec. 7613. Restrictions on university tax inquiries and examinations. Sec. 7614. Cross references.
Section 7605(c) of such Code is amended to read as follows: (c) Cross references (1) Restrictions on church tax inquiries and examinations For provisions restricting church tax inquiries and examinations, see section 7611. (2) Restrictions on university tax inquiries and examinations For provisions restricting university tax inquiries and examinations, see section 7613.
If enacted, the amendments would apply to inquiries and examinations beginning after the enactment date.
The amendments made by this section shall apply with respect to inquiries and examinations beginning after the date of the enactment of this Act.
The supplied actions snapshot, updated October 16, 2026, records introduction in the House and referral to the House Committee on Ways and Means on September 10, 2026.
Source snapshot updated 2026-10-16T08:05:36Z. 2026-09-10: Referred to the House Committee on Ways and Means. 2026-09-10: Introduced in House
A closer look
Reviewed version: Introduced in House · 2026-09-10. These findings describe provisions and who may benefit; they are not judgments of waste, corruption, or motive.
This review covers the supplied bill text. “None identified” does not rule out provisions in later versions or accompanying reports and disclosures.
Provisions outside the bill’s main subject, or policy changes attached to appropriations.
None identified in the reviewed text
No unrelated provision or policy change attached to appropriations was identified in the complete supplied introduced text. This conclusion is limited to that version and does not establish the contents or attachment history of other versions or accompanying materials.
Spending directed to particular recipients or places outside ordinary competitive or formula-based allocation.
None identified in the reviewed text
No congressionally directed spending for particular recipients or places was identified in the complete supplied introduced text. This conclusion is limited to that version; accompanying earmark disclosures and reports were not supplied, so it does not establish absence in those materials or other versions.
Narrow exceptions, exemptions, or preferential treatment that warrant a closer look.
Findings to examine
A targeted procedural protection is identified below. This classification does not judge its merits or motivation.
Covered higher-education institutions and related organizations would receive a special restriction on repeat tax reviews, central to the bill's tax-inquiry policy. If a completed review produced neither a listed adverse tax action nor a request for significant operational changes, another review of the same or similar issues during the applicable five-year period would require the Secretary's written approval. The period would begin with the notice used for the completion deadline, with the bill's suspension rules applying. This is a targeted procedural protection, subject to the bill's exceptions.
The term university means— (A) any institution of higher education (as defined under section 102 of the Higher Education Act of 1965), and (B) any related organization (as defined under section 4968(g)(2)) of such an institution.
If any university tax inquiry or examination with respect to any university is completed and does not result in— (A) an inclusion of income, revocation of status, notice of deficiency, or assessment described in subsection (d)(1), or (B) a request by the Secretary for any significant change in the operational practices of the university (including the adequacy of accounting practices), no other university tax inquiry or examination may begin with respect to such university during the applicable 5-year period unless such inquiry or examination is approved in writing by the Secretary or does not involve the same or similar issues involved in the preceding inquiry or examination.
the term applicable 5-year period means the 5-year period beginning on the date the notice taken into account for purposes of subsection (c)(1) was provided. For purposes of the preceding sentence, the rules of subsection (c)(2) shall apply.
This section shall not apply to— (1) any criminal investigation, (2) any inquiry or examination relating to the tax liability of any person other than a university, (3) any assessment under section 6851, 6852, or 6861, (4) any willful attempt to defeat or evade any tax imposed by this title, or (5) any knowing failure to file a return of tax imposed by this title.
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