NEWS ALERT: Treasury Releases Long-Awaited Guidance for Federal Scholarship Tax Credit Program

New guidance provides critical details for states, scholarship granting organizations, taxpayers and families ahead of January 1, 2027 launch

WASHINGTON, D.C. — Today, the U.S. Department of the Treasury, in conjunction with the Internal Revenue Service (IRS), released proposed regulations as well as companion temporary regulations for the implementation of the Federal Scholarship Tax Credit program, also known as IRC 25F.

Among the key regulations, individual taxpayers may claim a nonrefundable federal income tax credit of up to $1,700 for qualified cash contributions to eligible scholarship granting organizations (SGOs) and married taxpayers filing jointly may claim a combined credit of up to $3,400.

The proposed regulations as well as temporary regulations provide important direction on key implementation matters as states, SGOs, schools, program providers, taxpayers and 

families prepare for the program’s launch on January 1, 2027.

Today’s release is particularly significant for the remaining 20 states that have not yet elected to participate in the program. With additional federal details now available, governors have greater clarity as they consider whether to participate and make this new federal benefit available to eligible K–12 students in public and non-public schools and families in their states.

“This proposed guidance marks an important step toward the successful implementation of the Federal Scholarship Tax Credit Program,” said Anne Lesser, President and CEO of Invest in Education Coalition. “For months, states and stakeholders have been preparing for 2027 while awaiting additional clarity from Treasury. This guidance provides critical information to help move those preparations forward and gives governors in states that have not yet elected to participate additional information as they consider participation.”

For more information about the Federal Scholarship Tax Credit Program or to learn which states are already set to participate, visit https://investineducation.org/.

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About Invest in Education Coalition

Invest in Education Coalition is a 501(c)(4) organization that advocates at the federal level to protect and expand the Federal Scholarship Tax Credit Program that will directly empower parents of students in K-12 education throughout the nation to choose the best school or education service for their children.