# What This Bill Does: Foreign Gifts to Colleges and Universities

This bill creates a new system to track and penalize colleges and universities that receive money from foreign countries and don't properly report it. Right now, schools are supposed to disclose gifts and contracts from foreign sources, but there's limited oversight to make sure they're actually doing it. This bill fixes that by adding audits and financial penalties.

The first part requires the Department of Education to audit at least 30 colleges every two years to check if they're properly reporting foreign gifts and contracts. The audits will focus on schools most likely to receive foreign money—like wealthy universities with large endowments, schools that have previously received major foreign donations, and institutions that have already been caught not reporting properly. When audits find unreported foreign money, the government will document exactly what was missed: the amount, which foreign source provided it, which country it came from, and when it was received.

The second part adds serious financial consequences. Schools that receive money from countries the government considers concerning (like China, Russia, Iran, and North Korea) will face a 300 percent tax on that income. So if a university receives a $1 million gift from one of these countries, it would owe $3 million in taxes. Additionally, any school that fails to report foreign funding will face a 110 percent penalty tax on the unreported amount—meaning if they hide $1 million, they owe $1.1 million in penalties. These penalties stack on top of each other if the unreported money came from a country of concern.

The practical effect is that colleges will face strong financial incentives to be transparent about foreign funding and to avoid accepting money from certain countries altogether. Schools with significant foreign partnerships or donations will need to ensure their reporting is accurate or face substantial tax bills. The public will also have better access to information about foreign funding at universities through reports posted on the Department of Education website.