To amend the Internal Revenue Code of 1986 to clarify the definition of applicable educational institution for purposes of the excise tax based on the income of private colleges and universities.

HR 10400 clarifies which private colleges and universities are subject to an existing excise tax on their income. It modifies the tax code by adding "below the graduate level" to the definition of "applicable educational institution," requiring institutions to offer programs below the graduate level and serve at least 500 tuition-paying students to be included. This change affects private colleges meeting these specific criteria, ensuring the tax applies only to institutions with undergraduate or similar programs. The amendment takes effect for tax years beginning after December 31, 2024.