Irs Plans to Deny Tax Exemption to Private Schools Worry Jewish Groups
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Irs Plans to Deny Tax Exemption to Private Schools Worry Jewish Groups

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Two officials will testify Tuesday in Washington on behalf of a wide range of Jewish organizations at hearings on Internal Revenue Service plans to strengthen regulations denying tax exemption to private schools practicing racially discriminatory admission policies, plans the organizations fear might adversely affect Jewish day schools.

According to a March 21 letter to the IRS from the National Jewish Commission on Law and Public Affairs (COLPA), the issue dates back to July, 1970, when the IRS announced guidelines to deny tax exempt status to racially discriminatory private schools. The guidelines were reportedly aimed at schools organized by white parents opposed to their children attending integrated public schools. The guidelines excluded private schools in which student admission was unrelated to racial considerations “as by a religious seminary.”

The exemption of Jewish and other religious private schools was affirmed by a 1975 ruling, declaring such private schools remained exempt if membership was “open to all on a racially nondiscriminatory basis.”


The decision of the Jewish organizations to ask for opportunities to testify at the hearings stemmed from what appeared to be ambiguity in the proposed 1978 proposed revenue procedures, as such IRS regulations are called. The proposed 1978 revisions, reportedly stemming from IRS doubts that the existing guidelines were adequate, specify that the revised guidelines apply to “church-related and church-operated schools,” cited in the 1975 ruling but that, under the proposed revisions, tax exempt schools must meet “certain affirmative record keeping and publicity requirements along with other guidelines for determining whether schools have racially nondiscriminatory policies as to students.”

To clarify the issue and obtain language in the proposed revisions to end any ambiguities and reinforce the tax exemption for Jewish day schools, the Jewish organizations chose Martin Cowan, COLPA vice-president, and Nathan Z. Dershowitz, director of the Commission on Law, Social Action and Urban Affairs of the American Jewish Congress, to testify at the hearings.

Initially, the IRS set the hearings for one day–Tuesday. But because of the widespread concern expressed to the IRS over the proposed changes by many non-public school organizations and religious groups, the hearings have been extended to Wednesday and Thursday. In addition to the March 21 COLPA letter to the IRS, the Jewish Telegraphic Agency was provided with an outline of the statement Cowan will present and a draft of the text of Dershowitz’ planned testimony.

Howard Zuckerman, COLPA president, said the COLPA presentation was worked out with Rabbi Bernard Goldenberg, chairman of the executive committee of Torah Umesorah. Cowan will testify on behalf of Torah Umesorah and the Association of Advanced Rabbinical and Talmudic Schools, and for the Union of Orthodox Rabbis of the United States and Canada, Agudath Israel of America, National Council of Young Israel, Poelei Agudath Israel of America, the Rabbinical Alliance of America, Religious Zionists of America, and the Union of Orthodox Jewish Congregations of America. The Dershowitz statement was worked out with the National Jewish Community Relations Advisory Council and Dershowitz will testify for the AJCongress, the NJCRAC and its member agencies and local Jewish community relations councils, and for a number of umbrella agencies, expected to include the American Association for Jewish Education, the Council of Jewish Federations and the Synagogue Council of America.


Basically, Cowan and Dershowitz will present the same positions. The 1978 proposed revisions are aimed at private schools in areas in which public schools being or have been integrated. Private schools in such areas may be presumed to be discriminatory if their minority enrollment is not at least 20 percent of the local school age minority population, or if there has been a substantial increase in white student enrollment which may be related to the integration of the area public schools. The burden will be on the school to satisfy the IRS that the school does not discriminate against minorities.

Both Cowan and Dershowitz plan to testify that no Jewish religious school discriminates on the basis of race because, as the COLPA statement puts it, “as long as the student is in fact Jewish, it would be contrary to Jewish religious principles to discriminate against him or her on the basis of race, skin color or similar factors.”

The two experts will point out that few Blacks, Orientals or members of other minorities in this country are Jewish and therefore few students at Jewish religious schools are members of such minorities. Accordingly, absence of Black students from Jewish religious schools is in no way proof of racially discriminatory policies and the presumption of such discrimination is irrational.

The undeniable growth in student populations in Jewish day schools stems from the way such schools are structured, starting usually with a kindergarten and first grade and then adding grades annually as the pupils prepare for promotion to the next higher grade. Establishment of Jewish schools to serve the needs of the Jewish community, a constitutional right, will necessarily result in enrollment expansion totally unrelated to the advantages or disadvantages in local public schools.

Dershowitz will stress that the proposed IRS revisions could, by unfairly burdening Jewish religious schools through placing on them the costly burden of proof of non-discrimination, seriously impinge on the religious rights of American Jews.


The Deroshowitz statement raises the possibility that the “suspect” Jewish schools might be forced to spend their limited funds on recruitment of minority students and faculty whose presence in such a school could only dilute the school’s program and inhibit its communal and religious mission.

He will propose that the IRS rewrite its definition of a “reviewable school” one suspect of racial discrimination–to exclude any religious school in which the absence of minority students or presence in insignificant numbers can be fairly attributed to the absence or insignificant numbers of minority group children in the school area belonging to that school’s religious denomination. He will also warn that application of the proposed revisions to Jewish religious schools could produce serious problems of undue entanglement of church and state and improper interference with religious liberties.

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