The Burger Court (1969–86)

Court Decisions

How did the Burger Court decide whether the IRS could deny tax-exempt status for schools and universities that discriminate on the basis of race?

The Burger Court ruled 8–1 in Bob Jones University v. United States (1983) that the Internal Revenue Service (IRS) policy denying tax-exempt status to schools and universities that discriminate on the basis of race was constitutional. In 1970, the IRS modified its regulations to deny tax-exempt status. Two schools—a college and a private Christian elementary and high school—filed separate lawsuits challenging the IRS policy. Bob Jones University, a South Carolina corporation that operated schooling from kindergarten through college and graduate school, forbade students from interracial dating and marriage. The university provided that those who married interracially, dated interracially, or encouraged others to do so would be expelled. Goldsboro Christian School generally admitted only Caucasian students. These schools contended that they met the regulatory definition of a tax-exempt organization. They also argued that they had a First Amendment free-exercise right to their religious beliefs that interracial associations were a sin.

The Supreme Court, in an opinion authored by Chief Justice Warren Burger, rejected the schools’ position. The Court determined that the IRS regulations included the fundamental principle that institutions seeking tax-exempt status must act according to “established public policy.” The Court cited the nation’s commitment to eradicating racial discrimination as public policy of the highest order. The Court majority also reasoned that the IRS had the power to issue a new interpretation of its regulations. Finally, the Court also rejected both schools’ First Amendment free-exercise of religion challenge. Burger wrote that the government’s fundamental interest in eradicating racial discrimination “substantially outweighs whatever burden denial of tax benefits placed” on the schools in question.


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