How Well Do You Know the New Tax Law? A News Quiz

The new tax law will alter the nonprofit sector in many ways, affecting foundation grant making, donor and corporate giving, and how college assets will be taxed.

The Chronicle reported on the legislation’s twists and turns as it wound its way through Congress, profiled one GOP senator who fought for changes favorable to nonprofits, and, once the law was passed, talked to nonprofit experts who analyzed its impact on every aspect of the charitable world.

See how well you understand the law, its impact on nonprofits, and the process that shaped it. To read more about these issues, see the links below the quiz.

Read more:

1. Some economists and fundraisers expect the new tax law to bring in more money to nonprofits this year, even though the law doesn’t take effect until 2026. Why?
2. The new law may chip away at giving from big donors because:
3. Sen. James Lankford, a Republican from Oklahoma and a longtime champion of nonprofits, was one of the senators responsible for getting the charitable deduction for non-itemizers into the tax bill. What other big win for the nonprofit sector was he partially responsible for?
4. College endowments worth more than $2 million per student will pay an 8 percent tax on net investment income. Those worth $750,000 to $2 million per student will pay 4 percent. Endowments worth $500,000 to $750,000 per student will continue to pay the same rate. What is that rate?
5. The House version of the bill would have taxed the wealthiest colleges at a much higher rate. What was that rate?
6. Nonprofits will pay an excise tax of 21 percent on the total amount paid to every employee earning $1 million or more. paid to every employee earning $1 million or more. Correct? — This sentence was hard to follow. AS How does that differ from current law?
7. What two categories of nonprofits will remain tax exempt, despite calls from critics that they act like for-profits and should be paying tax?
8. Some worry that corporate giving will decline — or become less predictable — with the new tax law. Why?

We welcome your thoughts and questions about this article. Please email the editors or submit a letter for publication.