The university, like many colleges and charities, is exempt from federal income and property taxes, saving it billions of dollars. President Trump has questioned whether it should enjoy that status.

The IRS is making plans to rescind the tax-exempt status of Harvard University, according to two sources familiar with the matter, which would be an extraordinary step of retaliation as the Trump administration seeks to turn up pressure on the university that has defied its demands to change its hiring and other practices.

President Trump had threatened the move on social media after Harvard refused to comply with administration demands to make policy changes and agree to federal oversight.