Modification of excise tax on endowment income of private colleges and universities

(a) In general Subsection (a) of section 4968 of the Internal Revenue Code of 1986 is amended by striking the applicable percentage and inserting 1.4 percent. (b) Conforming amendments (1) Section 4968 of the Internal Revenue Code of 1986 is amended by striking subsection (b) and by redesignating subsections (c), (d), (e), (f), (g), and (h) as subsections (b), (c), (d), (e), (f), and (g), respectively. (2) Subsection (e) of section 4968 of such Code is amended by striking (c) and (d) and inserting (b) and (c). (3) Paragraph (1) of section 4968(g) of such Code is amended by striking (d) and (f) and inserting (c) and (e). (4) Subsection (o) of section 6033 of such Code is amended— (A) by striking 4968(c) both places it appears and inserting 4968(b), and (B) by striking 4968(e) in paragraph (2) thereof and inserting 4968(d). (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2025.