Protecting Endowments from Our Adversaries Act

HR 4462, the *Protecting Endowments from Our Adversaries Act*, imposes a 50% excise tax on large private colleges and universities when they acquire investments in foreign entities listed on U.S. government watchlists (like Commerce’s Entity List or FCC’s Covered List). It also taxes 100% of net income from such investments annually. The bill targets institutions with over $1 billion in non-exempt assets (excluding assets used for their core educational purpose), excluding public universities. This directly affects the investment strategies of large private institutions by taxing both new acquisitions and annual income from investments in entities deemed national security risks by the government.