IRS Form 8525, Federal Scholarship Tax Credit: how donors claim it, and when it's released

Treasury’s proposed §25F regulations, filed for public inspection on October 1, 2026, name the donor claim form for the first time. Proposed § 1.25F-2(g)(1) reads:

“A taxpayer who claims the section 25F credit on the taxpayer’s Federal income tax return must substantiate the credit on Form 8525, Federal Scholarship Tax Credit (or successor form), by reporting such information as may be required in the form and instructions, including, for each SGO to which the taxpayer has made a qualified contribution during the taxable year, the unique donor number that the SGO was required to provide as part of a timely written acknowledgement.”

What the proposed rules say about the form so far:

• Donors complete Form 8525 and attach it to Form 1040.
• For each SGO, the donor reports the unique donor number from the SGO’s written acknowledgment, which the SGO must send by January 31 of the year after the gift. See how the donor number works.
• A donor who leaves off a required donor number “will be presumed not to have made a qualified contribution to that SGO.” The donor can rebut that with the SGO’s acknowledgment or other evidence the IRS finds satisfactory, within the time the IRS sets in a written request.
• The instructions for Form 8525 will also tell donors how to designate a gift as a qualified contribution to the SGO at the time of giving.

How claiming works with Form 8525, step by step

The form is the last step. Everything it asks for is created earlier, when you give. Under the proposed and temporary regulations:

1. Give cash to an SGO on a participating state’s SGO list, on or after January 1, 2027. It can be any participating state, not only yours. See the federal SGO list and the SGO directory.
2. Designate the gift as a §25F qualified contribution when you make it. The designation is irrevocable and can cover all or part of a gift. An SGO listed in more than one state lets you choose how the gift is split among those states.
3. Get the SGO’s written acknowledgment by January 31 of the next year. It shows the SGO’s EIN, your total designated contributions, whether you received anything in return, and your unique donor number. The SGO reports the same information to the IRS by February 28. You never give the SGO your Social Security number.
4. Complete Form 8525 and attach it to your Form 1040 for the year you gave, entering each SGO’s donor number. For a 2027 gift that is the 2027 return, filed in early 2028.
5. Keep every acknowledgment. If a donor number is missing from the form, the acknowledgment is what rebuts the IRS’s presumption that you made no qualified contribution to that SGO.

The full donor walkthrough, with worked examples, is in how to claim the Education Freedom Tax Credit.

How the credit on Form 8525 is figured

The IRS has not published the form’s lines, but the amount it will produce follows rules already in the statute and the proposed regulations (proposed § 1.25F-2):

• Start with your qualified contributions for the year, the cash you designated to SGOs.
• Subtract any state tax credit you receive for the same gift. This comes off before the cap: a $2,500 gift that earns a $500 state credit still supports the full $1,700. See how state and federal credits stack.
• Cap it at $1,700 per taxpayer. Under the proposed rules, spouses filing jointly are separate taxpayers, so a joint return can claim up to $3,400 when each spouse gives and designates their own gift. The rules are proposed, and Treasury says taxpayers may rely on them for 2027.
• Limit it to your tax. The credit is non-refundable: it can reduce your federal income tax to zero, not below.
• Carry forward what you can’t use for up to five years, oldest credit first.

The part of a gift that becomes credit (including credit carried forward) can’t also be deducted as a charitable contribution. Any part above the credit may be deductible under the ordinary charitable rules.

Form 8525 questions

The IRS has not released Form 8525 or its instructions. The first returns that can claim the credit are for tax year 2027, filed in early 2028. Until then, keep the SGO’s written acknowledgment for every §25F gift; it carries the donor number the form will ask for.

The only §25F form released so far is Form 15714, which states (not donors) use to make their advance election to participate. Check the IRS Federal Scholarship Tax Credit (FSTC) page for the latest official forms and guidance.