Video: Endowment/Foundation Excise Taxes

Margaret Chen, Global Head of the Endowment and Foundation Practice, hosted a webinar in August to discuss endowment/foundation excise tax legislation and key takeaways from the legislative process. Margaret was joined by Tracy Filosa and Chris Houston, who shared insights on the legislation, answered questions, and examined what next steps investors can take, even if they were not directly affected by the final legislation.

In June, the House of Representatives passed legislation that would have dramatically increased investment excise tax rates for many colleges, universities, and private foundations. The final legislation that was signed into law in July was less severe than feared, particularly for private foundations and some smaller colleges that actually wound up better off.

Nonetheless, this recent experience surfaced potential issues, concerns, concrete steps, and best practices that private foundations and endowments should be aware of in order to deal with the current environment and be prepared if changes are proposed in future legislation.

In this Part 2 session, we discussed:

• What did and didn’t happen, and what we can learn from it: How did the final legislation affect university endowments and private foundations? What can we learn from the experience, and how should we think about possible future legislation?
• Actionable strategies: What can investors do now to prepare the portfolio for both immediate and future challenges, whether we see any further changes in excise tax rates and rules or not?
• Professional insights: Our hosts shared insights from their more than 25 years of finance and investment experience, specializing in enterprise risk, tax-aware investing, spending policy, and financial sustainability.