Grand Canyon University's nonprofit status reaffirmed by IRS
GCU's nonprofit status reaffirmed by IRS
Federal tax officials have re-affirmed Grand Canyon University's nonprofit status. The university was approved by the IRS to operate as a nonprofit in 2018, but the U.S. Department of Education had a different viewpoint on the matter. FOX 10's Lindsey Ragas reports.
PHOENIX - Grand Canyon University says the Internal Revenue Service reaffirmed the school's status as a nonprofit institution following a four-year audit.
What we know:
According to GCU, the IRS concluded the university was "operating within the parameters of a 501(c)(3) entity" after reviewing thousands of documents, visiting the school and interviewing school officials.
"It's further confirmation," said GCU President Brian Mueller. "When we first made the change, the IRS approved it. The State of Arizona approved it. Arizona Private Postsecondary Board approved it. Higher Learning Commission approved it. It was only the department that had a problem with it, and that's kind of been the source, in the beginning, of all our problems."
The other side:
The IRS' decision comes after the U.S. Department of Education rescinded a record $37.7 million fine against the university.
The DOE justified the fine by claiming the university used deceptive advertising practices to trick students into thinking the cost of a doctoral degree would be less than the actual cost.
The fine was levied on Oct. 31, after an investigation found 78% of graduates paid an additional $10,000 to complete their graduate programs.
When the fine was levied, Mueller called the actions "ridiculous" and questioned if the school was targeted because it is the nation's second-largest Christian university. At the time, Liberty University was being threatened with a similar fine.
"We wanted to work with them to figure out how we can make this work, and it just ran into roadblocks," said Mueller. "Eventually, we filed a complaint. When we filed the complaint, then the retaliation started. It started weeks after that, and that started these investigations, which led to the fine."