ATHENS, Ohio – Trustees at Ohio University have stepped in after the Internal Revenue Service said the school’s president must pay taxes on the free, on-campus lodging provided for him.
An ongoing IRS audit of OU found that President Roderick McDavis should be paying taxes on his free residency in the 7,000 square-foot university-owned house in the heart of the Athens campus in southeast Ohio.
The university’s board of trustees voted last month to cover the unexpected cost of about $19,000 in federal, state and local taxes for this year. The university is also going to cover the taxes on McDavis’ term life insurance, which the audit also said was taxable. That brings the total to about $30,000.
University officials called the audit “not exactly routine,” but “not uncommon.” The IRS would not comment.
OU can’t appeal the IRS decision until the audit is closed, but university officials continue to discuss it with the agency.
“IRS interpretations on this point are somewhat ambiguous and continuously evolving, evidenced by the fact that some universities have treated on-campus presidential housing as exempt from taxable income under the IRS Code, while others have not,” OU spokeswoman Jennifer Krisch said in an email.
It’s unclear how the move will affect other university presidents.