# EFTC Credit (eftccredit.com), full text corpus > Long-form companion to https://eftccredit.com/llms.txt. Independent, primary-source reference on the federal Education Freedom Tax Credit (EFTC), also called the Educational Choice for Children Act (ECCA), the Federal Scholarship Tax Credit (FSTC), and IRC §25F: the dollar-for-dollar federal income tax credit for donations to Scholarship Granting Organizations (SGOs) that fund K-12 scholarships, effective January 1, 2027. Published by ECCA Credit, LLC. Editorially independent and not affiliated with the IRS, the Treasury, or any state agency. Legal claims are tied to the verbatim statutory text of 26 U.S.C. §25F and official IRS/Treasury guidance, archived at /documents. Where Treasury has not ruled, this site says so rather than guessing. State-by-state status last updated 2026-07-22. Everything below is reproduced from eftccredit.com; each item links to its canonical page. --- ## Glossary ### §25F (Section 25F) The section of the Internal Revenue Code that creates the federal scholarship tax credit. Added by the One Big Beautiful Bill Act in 2025 and effective for tax years beginning in 2027. Source: https://eftccredit.com/glossary#section-25f ### §530 (Coverdell rules) The Code section §25F cross-references to define qualifying expenses and what counts as a 'school', which sends part of that definition back to each state's law. Source: https://eftccredit.com/glossary#section-530 ### $1,700 cap The maximum §25F credit, set at $1,700 'for any taxpayer.' Whether a married-filing-jointly return gets one $1,700 cap or two ($3,400) is unsettled pending Treasury guidance; the prevailing reading is $1,700. Source: https://eftccredit.com/glossary#1700-cap ### 300% AMI (Area Median Gross Income) The income ceiling for scholarship eligibility: 300% of the area's median gross income, an area-specific figure adjusted for household size, not a single national number. Source: https://eftccredit.com/glossary#300-percent-ami ### 501(c)(3) The federal tax-exempt charitable status an SGO must hold to operate. Source: https://eftccredit.com/glossary#501c3 ### 90/10 rule §25F requires an SGO to spend at least 90% of its income on scholarships, capping administration at no more than 10%. Source: https://eftccredit.com/glossary#90-10-rule ### Administrative cap The maximum 10% of income an SGO may spend on operations and administration under the 90/10 rule. Source: https://eftccredit.com/glossary#administrative-cap ### AMT (Alternative Minimum Tax) A parallel federal tax calculation. How the §25F credit coordinates with the AMT is among the open items Treasury still needs to address. Source: https://eftccredit.com/glossary#amt ### Anti-earmarking Donors cannot designate their contribution for a specific student or family. Source: https://eftccredit.com/glossary#anti-earmarking ### Articles of incorporation The document filed with a state's Secretary of State that legally creates a corporation. For a 501(c)(3) it must limit the organization's purposes to exempt ones and dedicate assets to charity on dissolution. Source: https://eftccredit.com/glossary#articles-of-incorporation ### Bylaws The internal rulebook a nonprofit's board adopts: how directors are chosen, how meetings and votes work, what officers do. Not filed with the state, but under the previewed §25F rules, states will check that bylaws (or articles) require the SGO rules. Source: https://eftccredit.com/glossary#bylaws ### Carryforward Unused §25F credit (a donation larger than the tax you can offset this year) can be carried forward for up to 5 years. Source: https://eftccredit.com/glossary#carryforward ### Categorical eligibility Automatic income-eligibility for families already in a needs-based program (SNAP, Medicaid, TANF, free/reduced-price lunch), with foster children also treated as eligible. Source: https://eftccredit.com/glossary#categorical-eligibility ### Chairperson Not a separate job, the director who runs a given meeting: calls each agenda item, asks for the vote, keeps things moving. At a brand-new organization's first meeting it's usually the founder who convened it; once a president is elected, chairing board meetings is normally part of the president's role. Source: https://eftccredit.com/glossary#chairperson ### Charitable solicitation registration State registration most SGOs must complete before fundraising in a state, typically renewed annually. Source: https://eftccredit.com/glossary#charitable-solicitation-registration ### Conflict-of-interest policy A board-adopted policy requiring directors and officers to disclose personal stakes in the organization's decisions and to step aside from votes where they have one. The IRS publishes a sample in the Form 1023 instructions and asks on the form whether you have one. Source: https://eftccredit.com/glossary#conflict-of-interest-policy ### Coverdell ESA A tax-advantaged education savings account under §530. Distinct from a state-funded Education Savings Account (ESA) and from a §25F scholarship. Source: https://eftccredit.com/glossary#coverdell-esa ### Determination letter The IRS letter recognizing an organization as tax-exempt under 501(c)(3), issued after Form 1023 approval. Donors, grantmakers, banks, and state SGO lists all ask for it. Source: https://eftccredit.com/glossary#determination-letter ### Director minimum The smallest board a state allows a nonprofit corporation to have, set by the state's nonprofit corporation act. Commonly three; some states (like Arizona, California, Delaware, Kansas, Virginia) allow one. Three-plus unrelated directors is the practical floor for charity credibility regardless. Source: https://eftccredit.com/glossary#director-minimum ### Disbursement Paying out scholarship funds, typically to schools, or as receipt-verified reimbursement for qualified expenses. Source: https://eftccredit.com/glossary#disbursement ### Dissolution clause The articles provision saying that if the organization shuts down, remaining assets go to another charity or government body, never to insiders. The IRS organizational test expects it; writing it expressly is the safe path in every state. Source: https://eftccredit.com/glossary#dissolution-clause ### Donor substantiation The written acknowledgment an SGO must provide a donor to support a claimed §25F credit. Source: https://eftccredit.com/glossary#donor-substantiation ### ECCA (Educational Choice for Children Act) The bill name Congress used for the legislation that became §25F. Same program, different label. Source: https://eftccredit.com/glossary#ecca ### EFTC (Education Freedom Tax Credit) The common name for the §25F credit, used by advocacy groups and adopted by the U.S. Treasury in its June 2026 guidance announcement. Source: https://eftccredit.com/glossary#eftc ### EIN (Employer Identification Number) The federal tax ID number every organization needs for banking, hiring, and IRS filings. Issued free and instantly by the IRS online application; any site charging for one is a middleman. Source: https://eftccredit.com/glossary#ein ### Eligible student A K-12 student who qualifies for a scholarship, by household income (300% of area median) or by categorical eligibility. Source: https://eftccredit.com/glossary#eligible-student ### ESA (Education Savings Account) A government-funded, family-controlled account for a range of education expenses. A different school-choice model than an SGO tax-credit scholarship. Source: https://eftccredit.com/glossary#esa ### Fiscal year The 12-month accounting period an organization chooses (calendar year for most). It drives the Form 990 deadline: the 15th day of the 5th month after the fiscal year ends. Source: https://eftccredit.com/glossary#fiscal-year ### Form 1023 / 1023-EZ IRS applications for 501(c)(3) status. The streamlined 1023-EZ ($275) is for smaller orgs that qualify; the full Form 1023 ($600) is for larger or more complex organizations. Source: https://eftccredit.com/glossary#form-1023 ### Form 990 The annual information return exempt organizations file with the IRS: the 990-N postcard (receipts normally $50,000 or less), the 990-EZ (under $200,000 receipts and $500,000 assets), or the full 990. Public by law, and three straight missed years auto-revokes exemption. Source: https://eftccredit.com/glossary#form-990 ### FSTC (Federal Scholarship Tax Credit) The IRS's name for the same §25F credit, used on the IRS program landing page. Source: https://eftccredit.com/glossary#fstc ### Income verification Confirming an applicant's eligibility through documentation (paystubs, returns, transcripts) or categorical eligibility before awarding a scholarship. Source: https://eftccredit.com/glossary#income-verification ### Incorporator The person who signs and files the articles of incorporation. Their job ends once the board holds its first meeting and ratifies the formation. Source: https://eftccredit.com/glossary#incorporator ### IRS portal A system Treasury says it plans to build, in phases, for SGO administration and reporting under §25F. Source: https://eftccredit.com/glossary#irs-portal ### Minutes The written record of a board meeting: who attended, what was decided, how votes went. Nothing to do with clock time, the name comes from 'minute' as in small ('my-NOOT'), i.e. brief notes. Kept permanently; auditors, banks, the IRS, and state vetting teams treat minutes as proof the board actually governs. Source: https://eftccredit.com/glossary#minutes ### Motion A proposal formally placed before a board for a vote, spoken as a sentence starting "I move that…". Nothing gets voted on at a board meeting until someone states it as a motion; the minutes then record it as a resolution if it passes. Source: https://eftccredit.com/glossary#motion ### Multistate SGO An SGO that appears on more than one state's list. It must be located in each state and keep a separate §25F account per state. Source: https://eftccredit.com/glossary#multistate-sgo ### Nonrefundable credit A credit that can reduce your federal tax to $0 but cannot create a refund beyond the tax you owed. The §25F credit is nonrefundable. Source: https://eftccredit.com/glossary#nonrefundable ### Notice 2025-70 The late-2025 IRS notice requesting public comment on §25F implementation. Source: https://eftccredit.com/glossary#notice-2025-70 ### OBBBA (One Big Beautiful Bill Act) Public Law 119-21, the 2025 reconciliation law. Section 70411 of OBBBA added §25F to the tax code. Source: https://eftccredit.com/glossary#obbba ### Opt-in / advance election A state governor's election to participate in §25F. Without it, residents can't donate to in-state SGOs and claim the credit. The election is made annually. Source: https://eftccredit.com/glossary#opt-in ### Organizational meeting The first official board meeting after incorporation: adopt bylaws, elect officers, authorize the bank account and the 501(c)(3) application. Its minutes are the founding record everything else cites. Source: https://eftccredit.com/glossary#organizational-meeting ### Participating state A state that has opted in and submitted its list of qualified SGOs to the IRS. Source: https://eftccredit.com/glossary#participating-state ### Proposed regulations The Treasury/IRS rules interpreting §25F. Treasury expects them by the end of September 2026; taxpayers may rely on them for 2027. Source: https://eftccredit.com/glossary#proposed-regulations ### Qualified contribution A cash donation to a qualified SGO that is eligible for the §25F credit. The credit is for cash gifts only. Source: https://eftccredit.com/glossary#qualified-contribution ### Qualified elementary/secondary education expense An education cost a scholarship can pay for, defined by cross-reference to §530, tuition, fees, books, curriculum, supplies, and (Treasury intends) tutoring and special-needs services, with detailed expense rules still pending. Source: https://eftccredit.com/glossary#qualified-expense ### Quorum The minimum number of board members who must be present for a meeting's votes to count. Each state's nonprofit law sets a default (commonly a majority of directors) and how far bylaws may lower it. Source: https://eftccredit.com/glossary#quorum ### Registered agent The person or company with an in-state street address designated to receive legal papers for the corporation. Every state requires one; a board member at a real address works, or commercial services charge roughly $100 a year. Source: https://eftccredit.com/glossary#registered-agent ### Renewal / sibling priority Award priorities an SGO may apply, for example, continuing prior-year recipients and siblings of current recipients. Source: https://eftccredit.com/glossary#award-priority ### Second The one-word reply ("Second.") a DIFFERENT board member gives after a motion, meaning "I agree this deserves a vote." A motion with no second dies without a vote, it's the board's filter against one-person tangents. Not needed on a one-person board. Source: https://eftccredit.com/glossary#second ### Segregated account / safe harbor A separate §25F account for contributions. Treasury's previewed safe harbor measures the 90% test against this account, separately per state for multistate SGOs. Source: https://eftccredit.com/glossary#segregated-account ### Self-dealing prohibition A §25F rule barring SGO insiders from improperly benefiting from the organization. Source: https://eftccredit.com/glossary#self-dealing ### SGO (Scholarship Granting Organization) A nonprofit that receives donations and awards K-12 scholarships. Under §25F, donors give to an SGO and claim the credit; the SGO awards scholarships to eligible families. Source: https://eftccredit.com/glossary#sgo ### Tax liability The total federal income tax you owe for the year, before withholding. The §25F credit can't exceed it, but withholding does not disqualify you, since liability is what matters. Source: https://eftccredit.com/glossary#tax-liability ### Tax-credit scholarship The model §25F uses: private donations to an SGO earn the donor a tax credit, and the SGO awards scholarships. Privately funded, not a government appropriation. Source: https://eftccredit.com/glossary#tax-credit-scholarship ### Unique donor number A number (generated under an IRS-provided method) that an SGO includes on each donor's written acknowledgment and reports to the IRS, letting the IRS match credits to donors without donors sharing a Social Security number with the SGO. Source: https://eftccredit.com/glossary#unique-donor-number ### Voucher Government funds that pay private-school tuition for a family. A different model than the privately funded §25F tax-credit scholarship. Source: https://eftccredit.com/glossary#voucher --- ## Explainers ### For donors, families, and advisors #### The biggest obstacle to the §25F credit isn't politics, it's the adoption gap Once a state opts in and the program is live, the question that decides whether the Education Freedom Tax Credit works isn't political, it's whether ordinary taxpayers actually claim a credit that pays them back dollar-for-dollar. History says free money gets left on the table: workers skip employer 401(k) matches, and the no-cost presidential campaign checkoff fell from 29% participation to about 4%. The four frictions that suppress uptake (awareness, paperwork, cash-flow timing, and trust), why each one is fixable, and why adoption is won at the operator layer, not in the political fight. Audience: Advocates, SGO operators, donors, journalists, and policymakers. Updated 2026-07-14. Full article: https://eftccredit.com/learn/eftc-adoption-gap #### When do you actually get your §25F money? Claim the Education Freedom Tax Credit in your paycheck, not next year's refund Most people assume a January 2027 donation means waiting until the April 2028 refund to see the $1,700 back, roughly 16 months. It doesn't have to. The §25F credit is earned in the 2027 tax year, and federal withholding is adjustable in real time: with a corrected Form W-4, you recover the credit across your 2027 paychecks instead of lending it to the IRS interest-free. How the paycheck route works, why it's fully allowed (the W-4 is built to account for credits), the three guardrails that keep it clean (you need the tax liability, you must actually make the gift, and the timing rules), and a step-by-step for donors and their accountants. Audience: Donors, employees, and their tax advisors. Updated 2026-07-14. Full article: https://eftccredit.com/learn/eftc-paycheck-withholding #### The CPA's guide to the §25F Education Freedom Tax Credit: advising clients on the federal scholarship credit A practitioner's reference to IRC §25F (the EFTC / ECCA / FSTC): the $1,700 dollar-for-dollar credit, why it works for standard-deduction clients, the §25F(e) double-benefit bar, the §25F(b)(2) state-credit reduction, the 5-year FIFO carryforward, the unsettled married-filing-jointly cap, the unique donor number, how to verify an SGO is on a state's list, and year-end planning pointers, every rule cited to the statute. Audience: CPAs, enrolled agents, and tax advisors. Updated 2026-07-10. Full article: https://eftccredit.com/learn/eftc-guide-for-cpas #### Year-end tax planning and the EFTC: which December matters The Education Freedom Tax Credit takes effect January 1, 2027, which turns the usual year-end playbook upside down for one transition year: a cash gift to an SGO in December 2026 earns no federal credit, while the identical gift three weeks later comes back dollar-for-dollar, up to $1,700. What a 2026 gift is still worth (the §170 deduction, state scholarship credits), why December 31, 2027 becomes the first real EFTC deadline, the cash-only rule, the no-double-benefit rule, the five-year carryforward, the paperwork to keep, and a planning checklist by calendar. Audience: Donors and their advisors planning charitable gifts. Updated 2026-07-10. Full article: https://eftccredit.com/learn/eftc-year-end-tax-planning #### The EFTC, explained for your community: a shareable one-pager A plain-language, forward-it-to-anyone explainer of the new federal scholarship tax credit: what it is (up to $1,700 off your federal taxes, dollar for dollar, for donating to a scholarship organization), when it starts (January 1, 2027), who qualifies, how to check your state, the four steps to actually do it, whether you can support your own school, and the honest fine print. Written for parent lists, congregation emails, and community group chats. Audience: Parents, community members, and anyone sharing the program. Updated 2026-07-10. Full article: https://eftccredit.com/learn/eftc-community-explainer #### Can donors direct an EFTC gift to a specific school? What §25F actually prohibits Section 25F bans earmarking a donation for any particular student, and that ban is exactly as wide as it sounds: student-level, not school-level. Directing a gift toward a specific partner school's scholarship fund is permitted under the statute as written and is standard practice in state scholarship-credit programs. What donors can and cannot designate, the award rules the SGO must still follow, and what Treasury has and hasn't said. Audience: Donors, schools, and SGO operators. Updated 2026-07-10. Full article: https://eftccredit.com/learn/designating-gifts-to-schools #### Can the EFTC help public-school students? What §25F actually allows The Education Freedom Tax Credit (§25F) is often described as a private-school program, but its eligibility is student-based, not school-based, and it defines qualified expenses by reference to the IRC §530(b)(3)(A) Coverdell list, which covers academic tutoring, special-needs services, books, technology, and test fees. That means a public-school student from a qualifying household can, in principle, receive scholarship support. What the statute permits, what happens in practice today, and the honest limits. Audience: Public-school families, advocates, journalists, and SGO founders. Updated 2026-06-18. Full article: https://eftccredit.com/learn/eftc-for-public-schools #### The §25F donor number: how the IRS matches your scholarship tax credit (no SSN to the SGO) Treasury's June 2026 preview describes a unique donor number for the federal Education Freedom Tax Credit (§25F): the Scholarship Granting Organization issues each donor a number on a written acknowledgment, reports contributions to the IRS under it, and the donor reports it on their federal return, so the IRS can match a claimed credit to a real donor and a real SGO without the donor ever handing the SGO a Social Security number. What the number is, how it flows, and what it means for donors and SGO operators. Audience: Donors, tax advisors, SGO founders and operators. Updated 2026-06-19. Full article: https://eftccredit.com/learn/25f-donor-number #### What is the Education Freedom Tax Credit? The EFTC explained The Education Freedom Tax Credit (EFTC) is the new federal tax credit for donations to K-12 scholarship organizations, worth up to $1,700 and starting January 1, 2027. What the credit does, where the name comes from, what it means for donors, families, schools and scholarship organizations, and where each state stands. Audience: Anyone new to the program, donors, families, schools, operators. Updated 2026-07-19. Full article: https://eftccredit.com/learn/education-freedom-tax-credit #### What is the Federal Scholarship Tax Credit? The FSTC explained Federal Scholarship Tax Credit (FSTC) is the term the IRS uses for the federal K-12 scholarship donation credit at IRC §25F. What the credit is, why the IRS uses this name, how it behaves as a tax item (non-refundable, five-year carryforward, cash only, no double benefit), and what tax professionals need to know before the 2027 tax year. Audience: Taxpayers, CPAs, tax advisors, anyone researching the IRS term. Updated 2026-07-19. Full article: https://eftccredit.com/learn/federal-scholarship-tax-credit #### What is ECCA? The Educational Choice for Children Act explained A complete guide to the Educational Choice for Children Act (ECCA), also known as the Federal Scholarship Tax Credit (FSTC) and codified at IRC §25F. How the federal scholarship tax credit works, who qualifies, when it begins, and what state participation means. Audience: Anyone new to the program, parents, donors, educators, advocates. Updated 2026-06-12. Full article: https://eftccredit.com/learn/what-is-ecca #### How donors claim the $1,700 scholarship tax credit: rules, carryforward and examples How the Education Freedom Tax Credit (EFTC / §25F) works for donors: $1,700 per tax return, 5-year carryforward, non-refundable, cash only, no double-deduction with §170, plus worked examples. Audience: Donors, taxpayers, accountants. Updated 2026-07-14. Full article: https://eftccredit.com/learn/federal-tax-credit-explained #### EFTC scholarship eligibility: who qualifies and what's covered Which K-12 students qualify for EFTC scholarships, the income limits, what schools and educational expenses are covered, and how families apply through a Scholarship Granting Organization (SGO). Audience: Parents and guardians of K-12 students. Updated 2026-06-12. Full article: https://eftccredit.com/learn/scholarship-eligibility #### When a state opts out of the EFTC, the money leaves with it The Education Freedom Tax Credit is federal, so residents can claim the $1,700 credit whether or not their state opts in, but scholarships only reach students in participating states. Opt out, and your residents fund students elsewhere. The math, the stakes, and why opting in costs the state nothing. Audience: Advocates, voters, legislators, journalists, and state officials. Updated 2026-06-15. Full article: https://eftccredit.com/learn/state-opt-out-money-leaves #### How states opt in to the EFTC: the governor certification process How a state opts in to the federal EFTC scholarship program: the governor's annual Treasury submission, legislative vs. executive paths, what citizens can do to advocate, and what happens when a state doesn't participate. Audience: Advocates, voters, legislators, journalists. Updated 2026-07-24. Full article: https://eftccredit.com/learn/governor-opt-in-process #### EFTC for families of students with disabilities or special education needs How families of K-12 students with disabilities can use EFTC scholarships to fund therapies, specialized instruction, evaluations, and assistive technology, plus how SGOs prioritize special-education needs. Audience: Parents of K-12 students with disabilities or IEPs. Updated 2026-07-24. Full article: https://eftccredit.com/learn/ecca-special-needs #### EFTC for homeschool and microschool families: what's covered and how to apply How homeschoolers, microschool families, learning pods, and hybrid-school families can use EFTC scholarships, what expenses qualify, and how to find an SGO that supports your educational model. Audience: Homeschool, microschool, hybrid-school families. Updated 2026-07-24. Full article: https://eftccredit.com/learn/ecca-homeschool-microschool #### Every kid is “eligible.” In half the states, homeschoolers still can’t use the federal scholarship Every K-12 child is an eligible student under the federal Education Freedom Tax Credit (EFTC / §25F). But the scholarship can only pay for a “school,” and the law sends that word back to each state. An interactive 50-state + DC map: where homeschoolers can use the scholarship, where they can’t, and the 29 states where it comes down to one box on a form. Audience: Homeschool families, SGOs, policy advocates, journalists. Updated 2026-07-24. Full article: https://eftccredit.com/learn/homeschool-eligibility-by-state #### EFTC vs. state scholarship tax credit programs: how they compare How the federal EFTC tax credit compares to existing state-level scholarship tax credit programs, whether donors can stack the two, and what families should know about each. Audience: Donors and families in states with their own scholarship credits. Updated 2026-07-24. Full article: https://eftccredit.com/learn/ecca-vs-state-tax-credits #### EFTC vs. 529 plans and Coverdell ESAs: how the federal scholarship tax credit compares to education savings accounts The Education Freedom Tax Credit (EFTC / §25F), 529 plans, and Coverdell ESAs are three different federal K-12 tax benefits, and the same 2025 law (the One Big Beautiful Bill) both created the EFTC and expanded 529 plans. How each one works, who it's for, and how one family can use more than one. Audience: Families and donors weighing K-12 education funding options. Updated 2026-06-14. Full article: https://eftccredit.com/learn/eftc-vs-529-and-esas #### EFTC, FSTC, ECCA or §25F: why one program has four names EFTC, FSTC, ECCA and §25F all name the same federal K-12 scholarship tax credit. Advocacy groups say EFTC, the IRS says FSTC, Congress passed it as ECCA, and tax professionals cite §25F. Which name to use, who uses which, and how to tell they are the same thing. Audience: Anyone confused by the program's many names. Updated 2026-07-19. Full article: https://eftccredit.com/learn/what-is-fstc #### EFTC / §25F timeline: key dates from enactment to the 2027 launch A dated roadmap of the federal Education Freedom Tax Credit (EFTC / ECCA / §25F): when it was enacted, when states make the advance election and submit SGO lists, when donations begin counting, and when donors claim the first credits. Audience: Donors, families, SGOs, and advocates tracking the rollout. Updated 2026-06-12. Full article: https://eftccredit.com/learn/eftc-timeline-key-dates #### EFTC for private and faith-based schools: how to partner with an SGO How private, religious, and independent K-12 schools can benefit from the Education Freedom Tax Credit (EFTC / ECCA / §25F): how scholarship dollars reach your school through SGOs, what families need to qualify, and how to prepare for the January 2027 launch. Audience: Private, faith-based, and independent school leaders. Updated 2026-05-28. Full article: https://eftccredit.com/learn/eftc-for-private-schools #### SGO scholarships vs. ESAs vs. vouchers: how the three school-choice models compare The three main ways policy funds private education, tax-credit scholarships from SGOs (including the federal §25F / EFTC), education savings accounts (ESAs), and vouchers, compared on who funds them, who holds the money, eligibility, and how the federal credit fits and stacks. Audience: Families, donors, advocates. Updated 2026-06-15. Full article: https://eftccredit.com/learn/sgo-vs-esa-vs-voucher #### The federal SGO list: which organizations qualify and how donors verify one For a donation to earn the §25F credit, the scholarship granting organization must be on the list its state submits to the federal government. How an organization gets on that list, what makes it a qualifying SGO, why the IRS list can run behind a state's own roster, and how a donor confirms an organization qualifies before giving. Audience: Donors, SGO operators, tax advisors. Updated 2026-07-19. Full article: https://eftccredit.com/learn/federal-sgo-list #### What the Education Freedom Tax Credit pays for: the §530 qualified-expense list §25F does not define its own expense list. It borrows the Coverdell education savings account list at IRC §530(b)(3), which reaches far beyond private-school tuition: tutoring, books, curriculum, technology, testing fees, and services for students with disabilities. What a §25F scholarship can and cannot be spent on, and why the answer is broader than most people assume. Audience: Families, donors, schools, SGO operators. Updated 2026-07-19. Full article: https://eftccredit.com/learn/qualified-expenses-25f ### For SGO operators #### What is an SGO? A guide to EFTC Scholarship Granting Organizations What an SGO is, how organizations get designated by their state, the 90/10 rule, what compliance looks like, and how donors and families choose between SGOs. Audience: Nonprofits, schools, donors, families. Updated 2026-06-30. Full article: https://eftccredit.com/learn/sgo-guide #### How to start a Scholarship Granting Organization (SGO) under the EFTC The complete, start-from-nothing guide to launching a Scholarship Granting Organization (SGO) for the federal Education Freedom Tax Credit (EFTC / ECCA / §25F): incorporating a nonprofit, getting an EIN, filing for 501(c)(3) (Form 1023 vs 1023-EZ, real fees and timelines), opening the required separate bank accounts, registering to fundraise, meeting every §25F operating rule, getting on your state's list, and a step-by-step checklist, written for founders with zero nonprofit experience. Audience: First-time founders, nonprofit leaders, schools, community groups. Updated 2026-06-19. Full article: https://eftccredit.com/learn/how-to-start-an-sgo #### Can your existing nonprofit become an SGO? The §25F retrofit, step by step You are already a 501(c)(3), so most of the formation work is behind you. What carries over (your exemption, EIN, and registrations), the one test that decides whether retrofitting is even the right move (90% of ALL income to scholarships), the five §25F gaps an existing organization has to close, the single board meeting that closes them, and when forming a separate entity is the honest answer instead. Audience: Existing 501(c)(3) leaders, school foundations, scholarship funds, church and community nonprofits. Updated 2026-07-26. Full article: https://eftccredit.com/learn/existing-nonprofit-to-sgo #### The 90/10 rule and §25F compliance requirements for SGOs, explained A deep dive into the federal §25F rules every Scholarship Granting Organization must meet: the 90% income-to-scholarships requirement and 10% administrative cap, the 10-student rule, renewal and sibling priority, anti-earmarking, the self-dealing prohibition, separate-account rules, donor substantiation, and income verification. Audience: SGO operators, boards, nonprofit finance and compliance staff. Updated 2026-06-12. Full article: https://eftccredit.com/learn/sgo-90-10-rule-compliance #### The §25F proposed regulations: what Treasury has previewed, and what it means for SGOs and donors Treasury says the §25F (EFTC / FSTC) proposed regulations arrive by the end of September 2026 — and previewed their content: the 90% segregated-account safe harbor, the multistate SGO path, income-verification safe harbors, annual audits, unique donor numbers, and an IRS portal. A practical walkthrough of each item. Audience: SGO founders and operators, donors, advisors, state officials. Updated 2026-06-12. Full article: https://eftccredit.com/learn/25f-proposed-regulations-preview #### SGO software: the management platform for Scholarship Granting Organizations (§25F) What SGO software does and why the federal §25F 90/10 rule makes it essential: donor onboarding and identity verification, payment processing, per-donor §25F receipts, family applications and income verification, an award engine with renewal and sibling priority, separate-account fund accounting, state reporting, and an audit trail. A buyer's checklist, a build-vs-buy guide, and the four buying-decision questions, pricing model, fund custody, disbursement controls, and data portability, to ask any vendor before you sign. Audience: SGO founders, operators, boards, nonprofit finance staff. Updated 2026-06-19. Full article: https://eftccredit.com/learn/sgo-software #### The SGO compliance calendar: §25F deadlines and recurring obligations A milestone-by-milestone view of what a Scholarship Granting Organization must do to stay compliant with §25F: state list timing, the 90/10 test, annual third-party audits, donor acknowledgments and unique donor numbers, separate-account rules, and yearly renewals. Audience: SGO operators, boards, nonprofit finance and compliance staff. Updated 2026-06-15. Full article: https://eftccredit.com/learn/sgo-compliance-calendar #### How SGOs disburse EFTC scholarship funds to schools and families Money-out is the hardest part of running a Scholarship Granting Organization. How funds move from the SGO to a school or family once a scholarship is awarded, why scholarship money must never touch operating accounts, the record every disbursement needs, ACH versus check, and the controls that keep a disbursement audit-clean. Audience: SGO operators, boards, nonprofit finance staff. Updated 2026-07-19. Full article: https://eftccredit.com/learn/disbursing-funds-to-schools #### Income verification for SGOs: confirming household eligibility under §25F Every §25F scholarship goes to a household at or below 300% of area median gross income, and the SGO is responsible for confirming it. What area median gross income means, what documents establish a household's income, how to size the check to the family rather than over-collect, and how to keep verification records that survive an audit. Audience: SGO operators, program staff, boards. Updated 2026-07-19. Full article: https://eftccredit.com/learn/income-verification-for-sgos #### How to recruit donors for your SGO under the Education Freedom Tax Credit A §25F scholarship organization runs on donations, and the credit changes the pitch: a donor is redirecting up to $1,700 of federal tax they already owe, not writing a check they will not see again. Who your donors are, the dollar-for-dollar message that actually lands, the 10% cap that limits what you can spend to find them, and a first-year acquisition plan. Audience: SGO founders, operators, boards, development staff. Updated 2026-07-19. Full article: https://eftccredit.com/learn/recruiting-donors-for-your-sgo #### State tax-credit scholarship programs and the federal EFTC: how they stack Long before the federal Education Freedom Tax Credit, states ran their own tax-credit scholarship programs, Arizona, Florida, Pennsylvania, Indiana, Ohio, Georgia, Iowa and more. How those state programs work, how the new federal §25F credit interacts with them, whether a donor can use both, and what an organization already running a state program needs to know to add the federal layer. Audience: Existing state-program SGO operators, donors, advisors. Updated 2026-07-19. Full article: https://eftccredit.com/learn/state-tax-credit-scholarship-programs --- ## Primary law and official guidance Archived verbatim so a citation can be checked against the text rather than a paraphrase. ### 26 U.S.C. §25F, Qualified Elementary and Secondary Education Scholarships Verbatim statutory text of IRC §25F, the federal income tax credit for scholarship granting organization contributions enacted as part of the Educational Choice for Children Act (ECCA / FSTC). Category: Statute (enacted law). Citation: Public Law 119-21, title VII, §70411(a)(1) (enacted July 4, 2025). Issued: 2025-07-04. Effective: 2027-01-01. Official source: https://www.law.cornell.edu/uscode/text/26/25F Archived text: https://eftccredit.com/documents/section-25f ### 26 U.S.C. §139K, Exclusion from Gross Income for Qualified ECCA Scholarships Verbatim text of IRC §139K, which excludes ECCA / FSTC scholarship amounts from the gross income of recipients and their families. Companion provision to §25F. Category: Statute (enacted law). Citation: Public Law 119-21, title VII, §70411(b)(1) (enacted July 4, 2025). Issued: 2025-07-04. Effective: 2027-01-01. Official source: https://www.law.cornell.edu/uscode/text/26/139K Archived text: https://eftccredit.com/documents/section-139k ### 26 U.S.C. §530(b)(3), Definition of Qualified Elementary and Secondary Education Expenses Verbatim text of the Coverdell statute that defines the educational expenses ECCA / FSTC scholarships can fund, referenced directly by §25F. Category: Statute (enacted law). Citation: 26 U.S.C. §530(b)(3) (Coverdell ESA expense definition). Official source: https://www.law.cornell.edu/uscode/text/26/530 Archived text: https://eftccredit.com/documents/section-530-b3-coverdell-expenses ### Public Law 119-21, §70411(c), ECCA / FSTC Effective Dates The effective-date provisions of the One Big Beautiful Bill Act §70411, governing when §25F (the federal scholarship tax credit) and §139K (the scholarship income exclusion) take effect. Category: Legislative provision. Citation: Public Law 119-21, title VII, §70411(c) (enacted July 4, 2025). Issued: 2025-07-04. Effective: 2027-01-01. Official source: https://www.congress.gov/119/plaws/publ21/PLAW-119publ21.pdf Archived text: https://eftccredit.com/documents/obbba-section-70411-effective-dates ### IRS Notice 2025-70, Request for Comments on §25F Implementation IRS Notice 2025-70 (issued November 2025) requested public comment on implementation of the §25F federal scholarship tax credit ahead of forthcoming proposed regulations. Category: IRS guidance. Citation: IRS Notice 2025-70 (issued November 2025). Issued: 2025-11-25. Official source: https://www.irs.gov/pub/irs-drop/n-25-70.pdf Archived text: https://eftccredit.com/documents/irs-notice-2025-70 ### IRS Revenue Procedure 2026-6, Advance Election Procedure for §25F Covered States IRS Rev. Proc. 2026-6 (Internal Revenue Bulletin 2026-02) sets the exclusive procedure for states to make an Advance Election to participate in the §25F Federal Scholarship Tax Credit for calendar year 2027, using Form 15714. Category: IRS guidance. Citation: Rev. Proc. 2026-6, 2026-02 I.R.B. (released December 12, 2025). Issued: 2025-12-12. Official source: https://www.irs.gov/pub/irs-drop/rp-26-06.pdf Archived text: https://eftccredit.com/documents/rev-proc-2026-6 ### IRS Federal Scholarship Tax Credit (FSTC), Official Program Page The IRS's official landing page for the §25F Federal Scholarship Tax Credit (FSTC / ECCA), the authoritative source for the program's forms, guidance, and updates as they are released. Category: IRS guidance. Citation: Internal Revenue Service, Federal Scholarship Tax Credit (FSTC) program page. Official source: https://www.irs.gov/government-entities/federal-state-local-governments/federal-scholarship-tax-credit-fstc Archived text: https://eftccredit.com/documents/irs-fstc-program-page ### Treasury Preview of Forthcoming §25F Guidance, Remarks by DAS Kevin Salinger (June 9, 2026) Full text of Treasury Deputy Assistant Secretary Kevin Salinger's June 9, 2026 remarks previewing the §25F proposed regulations: the September timeline, the 90% segregated-account safe harbor, multistate SGOs, income verification, audits, donor numbers, and the IRS portal. Category: IRS guidance. Citation: U.S. Department of the Treasury, Office of Tax Policy, remarks delivered June 9, 2026; published June 10, 2026. Issued: 2026-06-10. Official source: https://home.treasury.gov/system/files/136/Preview-of-Forthcoming-Guidance.pdf Archived text: https://eftccredit.com/documents/treasury-25f-guidance-preview ### Treasury Press Release, Treasury Previews Education Freedom Tax Credit Guidance (June 10, 2026) Full text of the U.S. Treasury's June 10, 2026 press release previewing Education Freedom Tax Credit (§25F) guidance, committing to proposed regulations by the end of September 2026 that taxpayers can rely on for tax year 2027. Category: IRS guidance. Citation: U.S. Department of the Treasury press release (June 10, 2026). Issued: 2026-06-10. Official source: https://home.treasury.gov/news/press-releases/sb0527 Archived text: https://eftccredit.com/documents/treasury-eftc-press-release-june-2026 ### Treasury Fact Sheet, President Trump Delivers Affordable School Choice Options Through the Education Freedom Tax Credit Full text of the U.S. Treasury / Working Families Tax Cuts fact sheet on the Education Freedom Tax Credit (§25F): the $1,700 credit, how it works, who qualifies, eligible expenses, and program impact estimates. Category: IRS guidance. Citation: U.S. Department of the Treasury, Education Freedom Tax Credit Fact Sheet (Working Families Tax Cuts), released with the June 10, 2026 guidance preview. Issued: 2026-06-10. Official source: https://home.treasury.gov/wftc/fact-sheets/education-freedom-tax-credit-fact-sheet-113147.pdf Archived text: https://eftccredit.com/documents/treasury-eftc-fact-sheet ### Treasury Proposed Regulations under §25F, Expected by End of September 2026 Forthcoming proposed Treasury regulations implementing §25F (ECCA / FSTC). Treasury committed on June 10, 2026 to publish them no later than the end of September 2026. Will be linked here when issued. Category: Coming soon. Citation: Treasury Department / IRS, committed for no later than end of September 2026. Status: not yet issued. Archived text: https://eftccredit.com/documents/treasury-proposed-regulations ### IRS Form / Schedule for §25F Credit, Coming Soon The IRS form donors will use to claim the §25F (ECCA / FSTC) federal scholarship tax credit on their federal income tax return. Not yet published. Category: Coming soon. Citation: Internal Revenue Service, anticipated 2026. Status: not yet issued. Archived text: https://eftccredit.com/documents/irs-form-25f --- ## §25F status, all 50 states and D.C. (as of 2026-07-22) - Alabama: Opted in. Governor Kay Ivey. https://eftccredit.com/states/alabama - Alaska: Opted in. Governor Mike Dunleavy. https://eftccredit.com/states/alaska - Arizona: Governor vetoed. Governor Katie Hobbs. decided 2026-04-14. https://eftccredit.com/states/arizona Gov. Hobbs vetoed SB 1106 (Jan 16, 2026) and a second opt-in bill in April 2026, citing the need to wait for IRS regulations. - Arkansas: Opted in. Governor Sarah Huckabee Sanders. decided 2026-01-16. https://eftccredit.com/states/arkansas - California: No decision yet. Governor Gavin Newsom. https://eftccredit.com/states/california - Colorado: Opted in. Governor Jared Polis. decided 2025-12-05. https://eftccredit.com/states/colorado Polis called opting in a "no-brainer" and said he would "be crazy not to" take the federal credit for Colorado families. - Connecticut: No decision yet. Governor Ned Lamont. https://eftccredit.com/states/connecticut - Delaware: No decision yet. Governor Matt Meyer. https://eftccredit.com/states/delaware - District of Columbia: No decision yet. Governor Muriel Bowser. https://eftccredit.com/states/district-of-columbia Mayor (DC has no governor). - Florida: Opted in. Governor Ron DeSantis. decided 2026-01-28. https://eftccredit.com/states/florida - Georgia: Opted in. Governor Brian Kemp. https://eftccredit.com/states/georgia - Hawaii: Declined. Governor Josh Green. https://eftccredit.com/states/hawaii Gov. Green declined to make the 2027 advance election. In March 2026 the legislature introduced four resolutions (HR68, HCR74, SR148, SCR158) urging him to reconsider; the opt-in is annual, so Hawaii can still elect in for a later year. - Idaho: Opted in. Governor Brad Little. https://eftccredit.com/states/idaho - Illinois: No decision yet. Governor JB Pritzker. https://eftccredit.com/states/illinois - Indiana: Opted in. Governor Mike Braun. decided 2026-01-22. https://eftccredit.com/states/indiana - Iowa: Opted in. Governor Kim Reynolds. decided 2026-01-05. https://eftccredit.com/states/iowa - Kansas: Opted in. Governor Laura Kelly. decided 2026-04-13. https://eftccredit.com/states/kansas Kelly vetoed SB 361 on April 8; legislature overrode the veto during the April veto session (House 85-38, Senate 29-10). Kansas completed the formal federal advance election and appears on the IRS roster as of July 7, 2026. - Kentucky: Opted in. Governor Andy Beshear. decided 2026-03-17. https://eftccredit.com/states/kentucky Beshear vetoed HB 1; legislature overrode the veto the next day. HB 1 assigns the annual §25F election to the Secretary of State (not the governor), so the filing does not depend on the governor's cooperation. On July 22, 2026, Secretary of State Michael Adams completed the federal advance election and filed a regulation opening Kentucky's SGO declaration process, the first state to open an SGO sign-up. - Louisiana: Opted in. Governor Jeff Landry. decided 2025-12-17. https://eftccredit.com/states/louisiana - Maine: No decision yet. Governor Janet Mills. https://eftccredit.com/states/maine - Maryland: No decision yet. Governor Wes Moore. https://eftccredit.com/states/maryland - Massachusetts: No decision yet. Governor Maura Healey. https://eftccredit.com/states/massachusetts - Michigan: No decision yet. Governor Gretchen Whitmer. https://eftccredit.com/states/michigan - Minnesota: Declined. Governor Tim Walz. decided 2026-03-24. https://eftccredit.com/states/minnesota Walz said opting in is "never going to happen"; his supplemental budget had proposed ending longstanding state nonpublic pupil and transportation aid if Minnesota opted in. - Mississippi: Opted in. Governor Tate Reeves. https://eftccredit.com/states/mississippi - Missouri: Opted in. Governor Mike Kehoe. https://eftccredit.com/states/missouri - Montana: Opted in. Governor Greg Gianforte. https://eftccredit.com/states/montana - Nebraska: Opted in. Governor Jim Pillen. decided 2025-09-29. https://eftccredit.com/states/nebraska - Nevada: Opted in. Governor Joe Lombardo. https://eftccredit.com/states/nevada - New Hampshire: Opted in. Governor Kelly Ayotte. decided 2026-01-29. https://eftccredit.com/states/new-hampshire Opted in via Gov. Ayotte's January 2026 advance election (final and on the IRS official list, independent of the implementing bill). In June 2026 the legislature passed HB 1774, the §25F implementing statute (Dept. of Revenue Administration participates and auto-renews; Dept. of Education builds and submits the qualifying-SGO list), through both chambers (Senate May 14, House May 21); awaiting final enactment. - New Jersey: No decision yet. Governor Mikie Sherrill. https://eftccredit.com/states/new-jersey - New Mexico: Declined. Governor Michelle Lujan Grisham. decided 2026-01-27. https://eftccredit.com/states/new-mexico - New York: Announced (not finalized). Governor Kathy Hochul. decided 2026-05-08. https://eftccredit.com/states/new-york Hochul announced intent to opt in May 8, 2026 via her FY2027 budget proposal, but said she will review IRS guidance before formally finalizing; not yet certified. - North Carolina: Opted in. Governor Josh Stein. decided 2026-06-03. https://eftccredit.com/states/north-carolina Stein vetoed HB 87; the House overrode on May 20, 2026 and the Senate completed the override 30-19 along party lines on June 3, 2026, enacting the bill over the governor's objection. North Carolina is now opted in via legislative override (no gubernatorial action required). - North Dakota: Opted in. Governor Kelly Armstrong. decided 2026-01-26. https://eftccredit.com/states/north-dakota - Ohio: Opted in. Governor Mike DeWine. https://eftccredit.com/states/ohio - Oklahoma: Opted in. Governor Kevin Stitt. https://eftccredit.com/states/oklahoma - Oregon: Declined. Governor Tina Kotek. decided 2025-08-14. https://eftccredit.com/states/oregon - Pennsylvania: No decision yet. Governor Josh Shapiro. https://eftccredit.com/states/pennsylvania - Rhode Island: No decision yet. Governor Dan McKee. https://eftccredit.com/states/rhode-island - South Carolina: Opted in. Governor Henry McMaster. https://eftccredit.com/states/south-carolina - South Dakota: Opted in. Governor Larry Rhoden. https://eftccredit.com/states/south-dakota - Tennessee: Opted in. Governor Bill Lee. https://eftccredit.com/states/tennessee - Texas: Opted in. Governor Greg Abbott. decided 2025-12-10. https://eftccredit.com/states/texas - Utah: Opted in. Governor Spencer Cox. https://eftccredit.com/states/utah - Vermont: No decision yet. Governor Phil Scott. https://eftccredit.com/states/vermont Enacted H.933 as Act 164 (signed June 18, 2026): a conditional, public-schools-first §25F opt-in that directs the Governor to decline if federal rules invalidate the state's conditions, which Treasury's preview suggests they will. Final in/out turns on the September 2026 regulations. - Virginia: Opted in. Governor Abigail Spanberger. decided 2026-01-01. https://eftccredit.com/states/virginia Inherited the opt-in from outgoing Gov. Youngkin (R) days before taking office. - Washington: No decision yet. Governor Bob Ferguson. https://eftccredit.com/states/washington - West Virginia: Opted in. Governor Patrick Morrisey. https://eftccredit.com/states/west-virginia - Wisconsin: Governor vetoed. Governor Tony Evers. decided 2026-03-30. https://eftccredit.com/states/wisconsin Vetoed AB 602 after earlier declining (Sep 2025). - Wyoming: Opted in. Governor Mark Gordon. https://eftccredit.com/states/wyoming Live map and table: https://eftccredit.com/states --- ## Free tools (no signup) ### Federal Scholarship Tax Credit Calculator (§25F) Estimate your $1,700 federal scholarship tax credit. Because the credit is non-refundable, it can only offset tax you actually owe, this calculator estimates your federal tax liability first, then shows how much of your donation you can credit this year and how much carries forward. Use it: https://eftccredit.com/tools/tax-credit-calculator ### Which states have opted in to the federal scholarship tax credit? A live tracker of where all 50 states + DC stand on the federal Education Freedom Tax Credit (§25F), opted in, committed, pending, declined, or vetoed. Pick your state to see whether you can donate and claim the credit yet. Use it: https://eftccredit.com/tools/state-opt-in-tracker ### Scholarship eligibility checker (§25F income & 300% AMI) See whether your family is likely eligible for a §25F scholarship. The federal rule covers households at or below 300% of your area's median gross income, plus categorical eligibility for families already in needs-based programs. Use it: https://eftccredit.com/tools/scholarship-eligibility-calculator ### What does a §25F scholarship cover? Qualified-expenses checker Check whether an education expense, tuition, tutoring, curriculum, technology, therapies, and more, can be paid with a §25F scholarship. Covered, likely covered, depends-on-state, or not covered, with the reasoning for each. Use it: https://eftccredit.com/tools/qualified-expenses ### SGO 90/10 rule compliance calculator Check whether your Scholarship Granting Organization meets the §25F 90/10 rule. Enter your qualified contributions and scholarship spending to see your scholarship ratio, your 10% administrative headroom, and exactly how much more must go to scholarships if you're short. Use it: https://eftccredit.com/tools/90-10-compliance-calculator ### How much does it cost to start an SGO? Startup cost & timeline estimator Estimate what it costs and how long it takes to launch a Scholarship Granting Organization: incorporation, the IRS 501(c)(3) application (Form 1023 vs 1023-EZ), charitable-solicitation registration per state, and a registered agent, with a low-to-high range and a realistic timeline. Use it: https://eftccredit.com/tools/sgo-startup-cost-calculator ### SGO revenue & scholarship projector Model your Scholarship Granting Organization's potential: enter your expected number of donors and average donation to project gross funds raised, the 90% available for scholarships, your 10% operating budget, and how many students you could fund. Use it: https://eftccredit.com/tools/sgo-revenue-projector --- ## News archive, full text Federal, state, and regulatory developments, newest first. Reproduced in full. ### North Carolina named NCSEAA its SGO certifying office, and wrote a deadline that runs on Treasury's clock Date: 2026-07-24. Category: state-action. State: NC. When North Carolina's legislature [completed its veto override of House Bill 87 on June 3](https://eftccredit.com/news/north-carolina-senate-completes-stein-veto-override-june-2026), the coverage focused on the politics: a third state joining the federal Education Freedom Tax Credit (FSTC / ECCA / §25F) over its governor's objection. Read the enacted text of Session Law 2026-6, though, and the more consequential story is administrative. North Carolina did not just opt in. It wrote the program's state-side machinery into statute: a named certifying office, a published-list requirement, and a rulemaking deadline, all before Treasury has issued a single regulation. Only [Kentucky, which handed the same job to its Secretary of State in March](https://eftccredit.com/news/kentucky-sgo-registry-secretary-of-state-adams-hb1-march-2026), has gone as far in its enacted text, and the two states solved the problem in opposite ways. The office is the North Carolina State Education Assistance Authority, NCSEAA, the same agency that runs the state's Opportunity Scholarship program. New G.S. 116-204(14) empowers the Authority "to certify and submit a list of qualifying scholarship granting organizations to the Secretary of the Treasury," and new G.S. 116-209.111 requires it to publish that list on its own website, certify its authority to act for the State, and, if useful, bring in the Department of Revenue by agreement. For [Scholarship Granting Organization](https://eftccredit.com/learn/sgo-guide) founders, this answers a question that remains open in most opted-in states: in North Carolina, you now know exactly which agency's door to watch. Kentucky answered the same question by routing everything to an independently elected Secretary of State, a design meant to keep a hostile governor away from the paperwork. North Carolina, which also joined over a veto, instead handed the job to the existing scholarship agency. Then comes the sentence that explains the national holding pattern. Section 3 of the law directs NCSEAA to "establish any necessary rules by July 1, 2026, or within 120 days of the publication of federal regulations, whichever is later." July 1 came and went with no federal regulations, so the first arm of that formula passed inert by design, and the deadline now floats downstream of Washington: the state's clock starts only when Treasury's rules publish. With the proposed §25F regulations expected around the end of September, North Carolina's own statute contemplates state rulemaking finishing well after the program's January 1, 2027 start. We wrote earlier this month that [no state has opened federal SGO certification because everyone is waiting on the September proposed rule](https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026), and that still holds even after [Kentucky opened its own state-level SGO declaration on July 22](https://eftccredit.com/news/kentucky-adams-files-federal-25f-opens-sgo-declaration-july-2026). North Carolina is one of the few to have written that dependency into the text of an enacted law rather than leaving it to a press office's shrug. One more clause deserves attention from a specific audience. Section 4 provides that listed SGOs "may provide scholarships for any qualified elementary or secondary education expense, including home school expenses, to the extent allowed under federal law." That is an explicit statutory welcome for homeschool families, in a program where [homeschool access varies sharply by state](https://eftccredit.com/learn/homeschool-eligibility-by-state) because federal scholarship dollars can only flow to what each state treats as a school. North Carolina's drafters chose to name home schooling in the statute itself, which is about as clear a signal of intent as state law can send while federal definitions remain unsettled. The pro-adoption read is straightforward: North Carolina has already built what most opted-in states have not even sketched. The office is named, its duties are enacted, the homeschool question is answered in text, and the only missing input is the federal rule. When Treasury's regulations land, NCSEAA's 120-day clock starts and organizations will have a designated agency, not a guess, to apply to. Operators positioning for that moment can start with our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo), track the state on our [North Carolina page](https://eftccredit.com/states/north-carolina), and see who is already organizing in the [SGO directory](https://eftccredit.com/sgos). Sources: - N.C. Session Law 2026-6 (House Bill 87), enacted over veto June 3, 2026: §25F election, NCSEAA certification duty, rulemaking deadline, and home school clause: https://www.ncleg.gov/EnactedLegislation/SessionLaws/PDF/2025-2026/SL2026-6.pdf - NC General Assembly: House Bill 87 bill history (2025-2026 session): https://www.ncleg.gov/BillLookUp/2025/H87 - NC State Education Assistance Authority (NCSEAA): https://www.ncseaa.edu/ - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/north-carolina-ncseaa-certifying-office-statutory-deadline-july-2026 ### Kentucky files its federal §25F election and becomes the first state to open its SGO sign-up Date: 2026-07-22. Category: state-action. State: KY. Kentucky has done the thing it spent the spring setting up to do. At a Frankfort news conference on July 22, 2026, Secretary of State Michael Adams signed the paperwork completing Kentucky's federal advance election for the Education Freedom Tax Credit (FSTC / ECCA / §25F) with the IRS, and, in the same appearance, signed a state regulation that opens Kentucky's process for organizations to declare themselves Scholarship Granting Organizations (SGOs). "This President, Congress, General Assembly and Secretary of State have Kentucky students' backs," Adams said, adding that "all eligible Kentucky students, public, private and home-schooled, will soon have access to better and more affordable education." The filing closes the one thread our roster coverage has left dangling: after Kansas [completed its own election in early July](https://eftccredit.com/news/kansas-completes-federal-25f-filing-irs-roster-29-july-2026), Kentucky was the last veto-override state whose formal federal filing was still outstanding. That the filing came from the Secretary of State, and not the governor, is the whole point of how Kentucky joined. Kentucky reached §25F over Gov. Andy Beshear's objection: he vetoed [House Bill 1 on March 13 and the legislature completed its override four days later](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). Knowing an opposed governor would then be asked to administer a program he had just tried to kill, HB 1 routed the annual federal election and the state's SGO registry through the [independently elected Secretary of State](https://eftccredit.com/news/kentucky-sgo-registry-secretary-of-state-adams-hb1-march-2026) instead. In March we wrote that operators should watch that office, not the governor's, for the application process. July 22 is that design being exercised: the official the statute empowered filed the election and opened the door, and the governor's opposition never touched the paperwork. The roster arithmetic should be stated carefully, because two accurate counts still sit side by side. The IRS's official list of completed advance elections was last published showing 29 states and does not yet include Kentucky; a government roster updates on its own schedule, so expect a lag before the federal page reflects this filing. Our own [participation map already counts Kentucky among 30 opted-in states](https://eftccredit.com/states), because Kentucky has been in by state action since the override. What changed on July 22 is that the gap between those two numbers is now closing from Kentucky's side: the state has filed, and the official roster will catch up. That leaves New York as the remaining state that has [announced it will participate](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026) but not yet filed its election. The second signature is the one SGO founders should read closely. The regulation Adams filed establishes how Kentucky will accept, review, and process SGO filings, and it opens that process now: nonprofit entities, including out-of-state nonprofits, with confirmed 501(c)(3) public-charity status may file the SGO declaration form in person or by mail, with an online option through the Secretary of State's Fast Track portal to follow shortly. Kentucky's list of declared SGOs goes to the federal government by January 1, 2027, the date the program goes live and qualifying donations can begin. This makes Kentucky the first state to open any SGO sign-up step at all. It is worth being precise about what that does and does not mean: everywhere else, SGO participation is still gated on Treasury's proposed §25F regulations, expected at the end of September, which is why [no state has opened federal SGO certification](https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026). Kentucky has opened its own state-level declaration, getting organizations into line under state law, while the federal qualification rules still arrive on the national clock. For a Kentucky nonprofit weighing whether to run a scholarship program, this is the first moment in the whole §25F rollout with a concrete action attached rather than a wait. An organization with a 501(c)(3) determination can file the state SGO declaration with the Secretary of State now and be positioned for the January 1 list submission, and a donation to a qualified Kentucky SGO in 2027 can earn the dollar-for-dollar federal credit of up to $1,700. Founders can start with our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo), track Kentucky's status on our [Kentucky state page](https://eftccredit.com/states/kentucky) and the [national participation map](https://eftccredit.com/states), and see the organizations already forming in the [SGO directory](https://eftccredit.com/sgos). Kentucky built its participation to survive a hostile governor; the payoff is that its operators get to move first. Sources: - Kentucky Secretary of State Michael Adams enrolls Kentucky and opens the SGO declaration process (July 22, 2026), via The Advocate-Messenger: https://amnews.com/2026/07/22/kentucky-joins-2025-one-big-beautiful-bill-act-through-scholarship-tax-credit/ - WKYT: Kentucky officially enrolled in federal education tax credit program (July 23, 2026): https://www.wkyt.com/2026/07/23/kentucky-officially-enrolled-federal-education-tax-credit-program/ - LPM (Louisville Public Media): Adams opts Kentucky into scholarship tax credit program (July 23, 2026): https://www.lpm.org/news/2026-07-23/adams-opts-kentucky-into-one-big-beautiful-bill-scholarship-tax-credit-program - Kentucky Legislative Research Commission: HB 1 (2026 RS) bill record: https://apps.legislature.ky.gov/record/26RS/hb1.html - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/kentucky-adams-files-federal-25f-opens-sgo-declaration-july-2026 ### The biggest risk to the federal scholarship credit isn’t politics. It’s whether people claim it Date: 2026-07-14. Category: analysis. Almost all of the public attention on the federal Education Freedom Tax Credit (FSTC / ECCA / §25F) is political: which governors have opted in, which are holding out, whether a future Congress might narrow the program. A July 14, 2026 essay in Education Next argues that this is the wrong thing to fixate on. Its author, Frederick "Rick" Hess, director of education policy studies at the American Enterprise Institute and a longtime supporter of school choice, warns that amid a "steady drumbeat of triumphal PR," the questions that will actually determine whether scholarships reach students are being overlooked. His two concerns, whether donors will participate and whether a few bad-actor scholarship organizations could tarnish the rest, are not about politics or the merits of the credit, which he backs. They are about execution. On participation, Hess marshals uncomfortable precedent. Employer 401(k) matches, among the closest things to free money in personal finance, go partly unclaimed by a large share of eligible workers. The presidential campaign checkoff, a box that costs the taxpayer nothing, saw participation fall from roughly 29% in the late 1970s to about 4% in recent years. His point is not that §25F will fail, but that uptake is never automatic: people routinely leave tax-advantaged benefits on the table "largely due to the hassle factor." His prescriptions, user-friendly ways to contribute, employer facilitation, and adjustments that preserve take-home pay, are all about stripping out friction. The encouraging read is that everything Hess worries about is fixable, and fixable without waiting on the political weather. Awareness spreads fastest through trusted local messengers; the paperwork fear is answered by §25F's [unique donor number](https://eftccredit.com/learn/25f-donor-number), which lets the IRS match a claimed credit without the donor ever handing over a Social Security number; and the cash-flow concern Hess names most sharply is the most solvable of all, since donors can [adjust their tax withholding](https://eftccredit.com/learn/eftc-paycheck-withholding) to recover the credit across their paychecks instead of waiting for a distant refund. We lay out the full picture in [why the real obstacle to §25F is the adoption gap, not politics](https://eftccredit.com/learn/eftc-adoption-gap). For the people building this program, the essay reads less like a warning than a job description. The credit's total impact is the sum of thousands of individual decisions to give, and those decisions are made at a single point in the system: the Scholarship Granting Organization that asks. An SGO that makes donating simple, issues clean receipts and donor numbers immediately, and keeps audit-ready books converts far more of its potential donors, and inoculates the whole program against the reputational risk Hess fears. Founders can start with our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) and see the field already forming in the [SGO directory](https://eftccredit.com/sgos). Sources: - Frederick M. Hess, “Digging In on the New Federal Scholarship Tax Credit,” Education Next / AEI (July 14, 2026): https://www.aei.org/op-eds/digging-in-on-the-new-federal-scholarship-tax-credit/ - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/biggest-25f-risk-isnt-politics-its-uptake-july-2026 ### The teachers' unions say “voucher” like it's an insult. Parents say it like it's a lifeline. Date: 2026-07-10. Category: analysis. The national teachers' unions have a one-word strategy against the federal Education Freedom Tax Credit (FSTC / ECCA / §25F): voucher. They deploy it like a verdict, as if naming the thing settles whether it should exist. It doesn't. Strip away the framing and a §25F scholarship is a specific, concrete good: a child in a struggling school getting high-dosage tutoring, a family with a special-needs kid affording therapy, a parent finally able to choose the classroom that fits their child. If that is a voucher, then the honest question is not "is it a voucher," it is "why are the unions fighting this hard to take it away from kids." A recent [Washington Examiner op-ed by John Schilling of Defending Education](https://www.washingtonexaminer.com/op-eds/4640951/nea-aft-teachers-unions-education-freedom-tax-credit/) put that question directly, and the answer is not flattering to the people asking families to wait. The broader field of organized opposition is mapped in our coverage of [who opposes §25F and why](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026). Start with who it helps, because the unions won't. The "private-school voucher" line works only if you never mention public-school kids, so let's mention them. A §25F scholarship funds "qualified elementary and secondary education expenses" as defined by [§530(b)(3), the statute §25F points to](https://eftccredit.com/documents/section-530-b3-coverdell-expenses): academic tutoring, special-needs services, books, computer technology, and after-school enrichment, at private or public schools. [Treasury's own fact sheet](https://eftccredit.com/documents/treasury-eftc-fact-sheet) is explicit that a child who stays in the neighborhood public school can use a scholarship for tutoring and support services. North Carolina's Democratic governor Josh Stein grasped this immediately: after losing his veto fight he [moved to steer the credit toward public-school students](https://eftccredit.com/news/north-carolina-stein-public-school-sgo-pivot-25f-june-2026). The unions call it an attack on public schools. It can be pointed straight at public-school kids, and a Democratic governor is already doing exactly that. It takes nothing from public schools to do it. No district loses a dollar. §25F is a federal credit for voluntary private donations. A donor gives up to $1,700 of their own money and the federal government forgoes the matching revenue, not a state and not a school district. No state education line item shrinks. The Supreme Court settled the principle in 2011 in Arizona Christian School Tuition Organization v. Winn, holding a tuition tax credit is private money rather than a government expenditure, and that taxpayers had no standing to challenge it. A program funded by private dollars cannot divert public resources it never touches. Treasury asks the question in its own FAQ, "Does this program take money from local public schools?" The answer is no. So when the unions say a scholarship for a kid's tutoring hurts public schools, ask which specific public-school budget line the child's tutoring came out of. There isn't one. The program holds itself to a standard the unions can't meet. Every scholarship organization in §25F must pass a ["90% test"](https://eftccredit.com/documents/treasury-25f-guidance-preview): by law, an SGO has to spend at least 90 percent of its income on scholarships, which leaves no more than a tenth for everything else. Set that beside the accusers. As the Washington Examiner op-ed documented, since 2015 the NEA and AFT collected $467.2 million in member dues while routing $669.3 million to political organizations, spending more on politics than they took from teachers over the same span. A scholarship organization that spent the way the unions spend would be thrown out of the program by law. The institutions demanding "accountability" would fail the accountability the credit already requires of everyone helping kids. A state that sits out doesn't protect its kids, it exports their help. Opting in is an administrative election filed with Treasury, funded by donors, absorbed federally, free to the state budget. A state that refuses doesn't stop the credit, it just watches its own residents' eligible dollars flow to children in states that said yes. The op-ed estimated $6.5 billion in donations could redirect if only 15% of eligible taxpayers give in participating states. The money helps children somewhere. The only question a holdout governor actually decides is whether it helps children at home. Where each state stands is tracked on our [participation map](https://eftccredit.com/states). And the record of the side saying “trust us” is the weakest part of their case. The unions position themselves as the guardians of student outcomes. Under the status quo they are defending, fourth-grade reading proficiency fell from 65% in 2019 to 59% in 2024, and the share of eighth-graders scoring below basic in math rose from 32% to 41%. An institution presiding over those numbers, while spending more on politics than it collects in dues, is asking families to turn down help for their children on its say-so. Parents are entitled to ask what they are being asked to trust. The fight is already over; only the timing is live. The unions cannot reverse a state that has already opted in. The [congressional repeal bills](https://eftccredit.com/news/senate-democrats-introduce-ecca-repeal-bill-april-2026) have no Republican support, no committee action, and no path over a presidential veto. §25F was enacted through reconciliation in 2025, and several Democratic governors are opting in anyway. When your strongest remaining move is to talk families out of a benefit you couldn't block, you have lost the argument and you are hoping parents don't notice. Call it a voucher. Call it a scholarship. The substance doesn't change: a child gets tutoring, a family gets a choice, and not one dollar leaves a public school to make it happen. The people fighting it are protecting an institution. The credit protects the kid. Before the January 1, 2027 launch, a donor can fund it and an operator can build the organization that delivers it. Start with our [plain-English explainers](https://eftccredit.com/learn) and the current [SGO directory](https://eftccredit.com/sgos). Sources: - Washington Examiner: John Schilling (Defending Education), “Teachers unions oppose the Education Freedom Tax Credit” op-ed: https://www.washingtonexaminer.com/op-eds/4640951/nea-aft-teachers-unions-education-freedom-tax-credit/ - U.S. Department of the Treasury: Education Freedom Tax Credit fact sheet (eligible §530 expenses; “Does this program take money from local public schools?”): https://home.treasury.gov/ - 26 U.S.C. §530(b)(3): definition of qualified elementary and secondary education expenses (referenced by §25F): https://www.law.cornell.edu/uscode/text/26/530 - Arizona Christian School Tuition Organization v. Winn, 563 U.S. 125 (2011): a tuition tax credit is private money, not a government expenditure: https://supreme.justia.com/cases/federal/us/563/125/ - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/unions-voucher-label-25f-fact-check-july-2026 ### Kansas completes its federal §25F election: the IRS roster grows to 29, and Kentucky is now the last override state waiting to file Date: 2026-07-07. Category: state-action. State: KS. Kansas has finished the paperwork. The IRS's official list of states participating in the federal Scholarship Tax Credit (FSTC / ECCA / §25F), updated July 7, 2026, now includes Kansas among the states with completed advance elections, the formal Form 15714 filing that puts a state on the federal roster for the program's January 1, 2027 launch. The official count now stands at 29 states, up from the [27 the IRS announced on June 8](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) and the 28 it reached in late June when North Carolina filed. The filing closes a gap that has trailed Kansas since spring. Kansas did not arrive at §25F by a governor's signature: Gov. Laura Kelly vetoed SB 361, and in April the legislature [overrode her veto](https://eftccredit.com/news/kansas-legislature-overrides-kelly-veto-april-2026), House 85-38 and Senate 29-10, making Kansas one of three states to force the program in over a governor's objection, alongside Kentucky and North Carolina, the [veto-override path we have tracked all year](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). But an override makes participation state law; it does not by itself complete the federal election, which is an executive filing to the IRS. That mismatch left Kansas politically in but officially absent from the federal roster for nearly three months. North Carolina resolved the same mismatch in late June, and Kansas has now followed. The roster arithmetic is worth stating precisely, because two true counts circulate side by side. The IRS's official roster, the list of completed advance elections, now shows 29 states. Our own [participation map counts 30 states as opted in](https://eftccredit.com/states), because it includes Kentucky, which is in by state action, its legislature overrode Gov. Andy Beshear's veto of HB 1 in March, but whose formal federal filing has not yet appeared. New York sits in a separate category: Gov. Kathy Hochul [announced in May that the state will participate](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026), but no election has been filed, so we track it as committed rather than opted in. As each state files, the official roster catches up to the map. For Kentucky, the outstanding step now has an unusual owner. Under HB 1, the statute the legislature passed over Beshear's veto, the annual federal election and the state's SGO registry run through the [independently elected Secretary of State, Michael Adams](https://eftccredit.com/news/kentucky-sgo-registry-secretary-of-state-adams-hb1-march-2026), rather than the governor's office, precisely so a governor who opposed the program cannot stall the paperwork. Kansas's completed filing leaves Kentucky as the lone override state not yet on the federal list, and the mechanics of its filing will be an early test of that workaround design. Update: Kentucky [completed that filing on July 22, 2026](https://eftccredit.com/news/kentucky-adams-files-federal-25f-opens-sgo-declaration-july-2026), when Secretary of State Michael Adams signed the state's federal advance election and opened Kentucky's SGO declaration process. For Kansas donors, families, and prospective scholarship organizations, the practical meaning is certainty: Kansas is on the federal roster the IRS will use when the program goes live, so a donation to a qualified Kansas Scholarship Granting Organization in 2027 can earn the dollar-for-dollar federal credit of up to $1,700. The next state-side milestone is the same one every participating state is waiting on: SGO certification, which [no state has opened yet](https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026) because the rules governing it arrive with Treasury's proposed regulations, expected by the end of September. Operators who want to be ready for that window can start with our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo); Kansas's status is tracked on our [Kansas state page](https://eftccredit.com/states/kansas) and the [national participation map](https://eftccredit.com/states), and the organizations already forming are in the [SGO directory](https://eftccredit.com/sgos). Sources: - IRS: Federal Scholarship Tax Credit (FSTC) participating states (updated July 7, 2026; lists Kansas): https://www.irs.gov/government-entities/federal-state-local-governments/federal-scholarship-tax-credit-fstc - IRS IR-2026-76: More than half the U.S. states signed up to participate (June 8, 2026; the 27-state baseline): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - IRS: Form 15714, advance election for the Federal Scholarship Tax Credit: https://www.irs.gov/forms-pubs/about-form-15714 Canonical: https://eftccredit.com/news/kansas-completes-federal-25f-filing-irs-roster-29-july-2026 ### One year in: the federal scholarship tax credit turns one on July 4, and the map has filled in faster than almost anyone expected Date: 2026-07-04. Category: analysis. One year ago today, on July 4, 2025, President Trump signed the One Big Beautiful Bill Act (Public Law 119-21) into law, and with it delivered something the school-choice movement had worked toward for a generation: section 70411 created a new §25F of the Internal Revenue Code, the first federal tax credit in American history for donations to K-12 scholarship organizations. The design is elegant. A donor anywhere in the country can give up to $1,700 to a qualified Scholarship Granting Organization (SGO) and claim the full amount back as a dollar-for-dollar federal credit, turning what would have been a tax payment into a scholarship for a child in their own community. On its first birthday, the credit has gone from a single provision in a long bill to a national program that 30 states have already joined, with the first donations now just six months away. The pace of adoption has outrun nearly every early prediction. On signing day, not one state had opted in; twelve months later, 30 are on the participation map. Nebraska led the way, with Gov. Jim Pillen signing on September 29, 2025, before the IRS had even released the form states would use. Virginia became the first to complete the formal federal election in January 2026, and a broad wave followed through the winter and spring. The momentum proved strong enough that states came in even where their own governors had hesitated. By this summer the IRS's official roster listed 29 states with completed advance elections, [Kansas filed days after this anniversary](https://eftccredit.com/news/kansas-completes-federal-25f-filing-irs-roster-29-july-2026), while our own [participation map counts 30](https://eftccredit.com/states) (Kentucky is in by state action and has simply not yet filed its formal federal election). For a program that began the year at zero, that is an extraordinary run, and several of the remaining states are visibly weighing the same move. The federal rules came into focus alongside the state wave. The IRS published the advance-election form in December 2025 and its official roster of participating states in June 2026. Then, on June 10, 2026, the Treasury Department released a [preview of the forthcoming §25F regulations](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026) that handed operators their first real blueprint: a clean 90%-of-income test measured against a dedicated account, an annual audit, and a unique-donor-number system so an SGO never handles a Social Security number. Treasury also said states, SGOs, and taxpayers can rely on the coming rules for the 2027 tax year, which is why tax advisers spent the following weeks telling clients to start building now rather than wait. The proposed regulations themselves are due by the end of September 2026. That September date is the last gate before the program goes live, and the states are staged and ready for it. SGO certification has not opened anywhere yet, and that is by design, not delay: the rules that govern it were sensibly held for the September regulations, and several states have already moved as far as they can in the meantime. Alabama has published its certification criteria, Idaho, Kentucky, and North Carolina have named the offices that will run their lists, and Virginia expanded its approved scholarship-organization roster on Youngkin's way out the door. The moment the rules land, the certification windows open and the runway to launch is short and clearly marked. What stands out most at one year is how broad the credit's appeal turned out to be. Colorado's Gov. Jared Polis became the first Democratic governor to opt in, and the reason the map filled the way it did is practical rather than ideological. §25F does not spend a state's own money; it lets a state's residents redirect federal tax they would otherwise owe into scholarships for local children. A state that participates keeps those federal dollars working for its own families, and a state that sits out simply sends them to families elsewhere. Seen that way, opting in is less a political statement than a decision not to leave money on the table, which is exactly how a growing number of governors across the spectrum have come to treat it. Year two is when the credit becomes real for families. The path from here is short and clear: the proposed regulations at the end of September, a fourth-quarter stretch in which states open SGO applications and certify their lists, and then January 1, 2027, when the first donations can be made and the first scholarships awarded. For anyone thinking about starting or running an SGO, this anniversary is the moment to move: the roughly six months between now and launch are the window to stand up a 501(c)(3), build a donor base that stays comfortably inside the [10% administrative cap](https://eftccredit.com/news/25f-sgo-marketing-cost-10-percent-cap-june-2026), and choose the software to run a compliant program. Our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) lays out what can be done today, the [participation map](https://eftccredit.com/states) tracks every state, and the [directory](https://eftccredit.com/sgos) maps the field already forming. One year after a president's signature, the first federal scholarship tax credit has gone from an idea to a near-certainty with a launch date on the calendar, and its best year is the one just ahead. Sources: - The White House: President Trump's One Big Beautiful Bill Is Now the Law (July 4, 2025): https://www.whitehouse.gov/releases/2025/07/president-trumps-one-big-beautiful-bill-is-now-the-law/ - Public Law 119-21 (One Big Beautiful Bill Act); §25F created by section 70411: https://www.congress.gov/bill/119th-congress/house-bill/1 - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F - U.S. Treasury: Preview of Forthcoming Section 25F Guidance (June 10, 2026): https://home.treasury.gov/system/files/136/Preview-of-Forthcoming-Guidance.pdf Canonical: https://eftccredit.com/news/one-year-since-25f-signed-obbba-july-2026 ### Six months to launch, and not one state has opened SGO certification. Here is why, and what to do with the wait. Date: 2026-07-03. Category: analysis. There is a gap in the middle of the federal Education Freedom Tax Credit (FSTC / ECCA / §25F) that the roster counts hide. Twenty-nine states have completed the formal advance election and appear on the IRS's official list of participating states, [Kansas filed on July 7](https://eftccredit.com/news/kansas-completes-federal-25f-filing-irs-roster-29-july-2026); our own [participation map counts 30](https://eftccredit.com/states), because Kentucky joined by overriding its governor's veto but its formal Form 15714 has not yet been filed with the IRS, and New York has announced it will participate without yet electing in (the roster catches up as each files). Either way the program goes live January 1, 2027, and that launch date, not anything that happens this year, is what governs when a donation can earn the credit: §25F is a credit for the 2027 tax year, so no gift made in 2026 qualifies, even to an SGO that is already certified. Nobody is making a credited donation before January 1 regardless of how fast the states move. What is striking at the halfway mark is that the machinery meant to run the program from day one is not standing yet. As of early July 2026, with roughly six months on the clock, no state has opened the process to certify a Scholarship Granting Organization (SGO). Not one. The election put states on the map; it did not switch the program on, because the machine that turns donations into scholarships, the certified-SGO list, does not exist yet anywhere. The reason is a deliberate sequencing choice at Treasury, and it is worth stating plainly so operators stop refreshing state websites waiting for an application form that is not coming this summer. The only part of §25F the IRS has fully built out is the state advance election, the Form 15714 filing a governor or designated official uses to opt a state in. The rules that govern SGO certification itself, who qualifies, how a state builds and submits its list, the deadline mechanics for the first year, were expressly deferred to the proposed regulations Treasury previewed on June 10 and said it expects to issue no later than the end of September 2026. Until those land, states have nothing final to certify against, and they are saying so, in writing, on their own pages. The state agencies are unusually candid about the hold. Alabama's Department of Revenue has already [published the six criteria an organization must meet to be certified](https://eftccredit.com/news/alabama-aldor-publishes-25f-sgo-certification-criteria-january-2026), 501(c)(3) status, scholarships to ten or more students at more than one school, at least 90% of income spent on scholarships, no earmarking for named students, Alabama students only, and ALDOR certification, then states directly that it is "awaiting additional guidance from the Treasury Department" before finalizing deadlines. [Nebraska's](https://eftccredit.com/states/nebraska) §25F page says flatly that it will post SGO forms and procedures only "after the final federal guidance has been published." [Mississippi's governor said the state would designate eligible SGOs "in the coming months."](https://eftccredit.com/news/mississippi-reeves-opts-in-25f-sgo-list-pending-january-2026) [Tennessee has assigned its Department of Education](https://eftccredit.com/news/tennessee-enacts-25f-enabling-law-public-chapter-720-homeschoolers-included-may-2026) to certify organizations and submit the list, but has not opened a window. The pattern is identical across every participating state we checked: authorized, staffed, and frozen, all waiting on the same September document. That turns a vague "sometime before 2027" into a sharp and predictable calendar. If the proposed regulations publish at the end of September and carry reliance for the 2027 tax year, as Treasury signaled they will, then the real certification sprint is the fourth quarter of 2026: states open applications, organizations apply and get listed, and each state submits its roster to Treasury, all compressed into the weeks before the January 1 launch. The states that did their homework early, Alabama pre-publishing criteria, Nebraska standing up an information page, Tennessee naming its certifying agency, are the ones positioned to open fastest once the gun sounds. The states still deciding who even administers the list (West Virginia adjourned without designating an officer) will be slower. For an operator, the state you organize in may determine whether you are certified in October or scrambling in December. The mistake would be to read "certification is closed" as "nothing to do yet." The wait is the build window, and almost everything an SGO needs is within an operator's control right now, independent of the September rules. The 501(c)(3) determination, the segregated account that will carry the 90%-of-income test, the annual-audit relationship, and above all the donor pipeline can all be assembled now, and the donor side is the one that decides whether a new SGO survives, because acquiring donors can cost more than the 10% administrative cap allows, a squeeze we covered in [our look at §25F marketing costs](https://eftccredit.com/news/25f-sgo-marketing-cost-10-percent-cap-june-2026). An operator who spends the third quarter building an audience it does not have to buy, and picking software that keeps intake, income verification, receipting, and disbursement inside the cap, walks into the fourth-quarter certification window ready to file rather than starting from zero. Our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) lays out exactly what can be done before the rules finalize. So the honest status of the program at the halfway mark is this: the yes votes are in, the plumbing is not connected, and the connection date is now legible. The end-of-September proposed regulations are the event that starts the certification race in every opted-in state at once; the first state to actually open SGO applications after that will be a genuine first worth marking. Until then, the work is preparation, not paperwork. Operators can track which states have opted in on the [national participation map](https://eftccredit.com/states), see the current field in the [SGO directory](https://eftccredit.com/sgos), and use the runway rather than wait it out. Update, July 22, 2026: Kentucky became the first state to open any SGO sign-up step, when Secretary of State Michael Adams [filed a regulation opening the state's SGO declaration process](https://eftccredit.com/news/kentucky-adams-files-federal-25f-opens-sgo-declaration-july-2026) alongside completing Kentucky's federal election. The distinction in this piece still holds: Kentucky opened a state-level declaration under its own HB 1, letting 501(c)(3)s get in line under state law, but federal SGO qualification, the criteria every state ultimately certifies against, still arrives with Treasury's end-of-September regulations. Kentucky moved first on the part it controls; the national certification race still starts in September. Sources: - Alabama Department of Revenue: The Education Freedom Tax Credit Program (SGO certification criteria; awaiting Treasury guidance): https://www.revenue.alabama.gov/tax-policy/the-education-freedom-tax-credit-program-alabamas-part-in-the-federal-sgo-program/ - Nebraska Department of Revenue: §25F Qualified Elementary and Secondary Education Scholarships (SGO forms to follow final federal guidance): https://revenue.nebraska.gov/internal-revenue-code-ss-25f-qualified-elementary-and-secondary-education-scholarships-information - U.S. Treasury: Preview of Forthcoming Section 25F Guidance (June 10, 2026; proposed regulations expected by end of September 2026): https://home.treasury.gov/system/files/136/Preview-of-Forthcoming-Guidance.pdf - Office of Gov. Tate Reeves: Mississippi opts into federal tax-credit scholarship program (SGOs to be designated in coming months): https://governorreeves.ms.gov/governor-reeves-opts-into-federal-tax-credit-scholarship-program-to-promote-school-choice/ Canonical: https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026 ### Every child is “eligible” for the federal scholarship. In half the states, homeschoolers still can’t spend it. Date: 2026-07-02. Category: analysis. When Congress created the federal Education Freedom Tax Credit (FSTC / ECCA / §25F) in 2025, the promise was sweeping. Beginning January 1, 2027, any K-12 child eligible to enroll in a public school can receive a scholarship from a Scholarship Granting Organization (SGO), funded dollar-for-dollar by donors who claim a federal credit of up to $1,700. "Every kid is eligible" became the rallying line of the school-choice movement. For homeschool families in roughly half the country, that line is misleading, and the reason is buried in a single statutory cross-reference that almost no one outside a handful of tax lawyers has read. The credit, codified at Section 25F of the Internal Revenue Code, actually contains two different tests, and home-educated children fall straight through the space between them. The first test asks who is an eligible student, and it is broad: a child qualifies if their household income is at or below 300% of the area median and they are "eligible to enroll in a public elementary or secondary school." Homeschoolers clear that bar without breaking stride. The second test asks what is a qualified expense, and it is narrow. A scholarship may only pay for a "qualified elementary or secondary education expense," a term §25F defines not on its own but by pointing to a different statute, IRC §530(b)(3)(A), the rulebook for Coverdell education-savings accounts. And §530 ties every qualifying expense to enrollment or attendance "at a public, private, or religious school," then defines "school" as one providing K-12 education "as determined under State law." Read those two tests together and the trap appears. A homeschooled child can be a perfectly eligible student and still have no qualifying expense to spend the scholarship on, if their state's law does not treat the home itself as a "school." There is no separate homeschool category anywhere in §530. Tellingly, the very same 2025 law did amend the §529 college-savings rules to cover homeschool expenses by name, but §25F points to §530, which got no such fix. Anyone who assumes "the new law covers homeschoolers" is reading the wrong section. This is not a drafting ambiguity that a friendly regulation might quietly read away. On June 10, 2026, the Treasury Department released a [preview of its forthcoming §25F guidance](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026) that says it plainly: it expects the rules to define "school" consistent with §530 to include public, private, and religious schools providing K-12 education as determined under state law, and "accordingly, a home school would be treated as a school if it is treated as a school under State law." A Treasury tax-policy official had walked through the identical statutory path at an industry webinar the day before. The written preview removes even the hedge: homeschool access to the federal scholarship now turns entirely on each state's classification of home education, a question of state law that Washington has expressly declined to override. The homeschool world has always sorted states by how much paperwork a family must file, light regulation here, heavy regulation there. But that is the wrong axis for this question. What matters for §25F is a different, rarely-asked question: does your state's law call the home a "school," or does it route home education through a separate "home instruction" category that is, by design, not a school? We classified all 50 states and the District of Columbia against exactly that test, citing the controlling statute or court decision in each, in our [interactive 50-state map](https://eftccredit.com/learn/homeschool-eligibility-by-state). The result is not a tidy half-and-half: 15 states likely qualify, because the home is a "school" under state law (Texas counts a home school as a private school after a 1994 state Supreme Court ruling; Arizona's statute literally defines "homeschool" as "a nonpublic school"); 23 states plus D.C. likely do not, because home education sits in a separate "home instruction" box the statute deliberately holds apart from a school (Virginia's statute commands that parent-led home instruction "shall not be classified or defined as a private ... school"); and 12 states are genuinely gray, awaiting Treasury's separate guidance on which §530 expenses count. The single most consequential finding: in 29 states, the answer is pathway-dependent. Many states let a family home-educate either by operating as a private school or by filing under a standalone home-education statute. Choose the first box and the child likely qualifies; choose the second and they likely don't. Same child, same kitchen table, different paragraph of state law. In Alaska, a family that registers as a private school is in; one that uses the parental home-education exemption is out. Most families have no idea the choice carries a federal-scholarship consequence, because until now no one had a reason to ask. The stakes are not abstract. Some SGOs are already marketing to homeschool families with flat assurances of "no homeschool exclusion," a claim Treasury's own preview directly contradicts. For a credit that pays dollar-for-dollar, telling a family the money is theirs when their state's law won't let them spend it isn't a rounding error. It is a promise that breaks at the worst possible moment: after the school year has been planned around it. Two things could close the gap, and neither is automatic. A state that routes homeschoolers through a non-school "home instruction" statute could amend its definitions to recognize home schools as schools, as 15 states already effectively do, but that is a state legislative fix, fifty separate fights. Or Treasury's forthcoming §530 expense guidance, a separate workstream the department says will follow the main §25F regulations expected by late September 2026, could read "school" more generously and carve out hybrid arrangements, so that a homeschooler who also enrolls part-time in a co-op or microschool that is a private school keeps a qualifying expense. Until one of those happens, "every kid is eligible" remains true in the narrowest legal sense and false in the way that counts. The least we can do before January 2027 is tell families the truth about their own state, which is exactly what our [state-by-state map](https://eftccredit.com/learn/homeschool-eligibility-by-state) and our guide to [who §25F actually covers](https://eftccredit.com/learn/eftc-for-public-schools) are for. Sources: - U.S. Treasury: Preview of Forthcoming Section 25F Guidance (June 10, 2026): https://home.treasury.gov/system/files/136/Preview-of-Forthcoming-Guidance.pdf - U.S. Treasury: press release on the §25F guidance preview (June 10, 2026): https://home.treasury.gov/news/press-releases/sb0527 - 26 U.S.C. §530 (qualified expense and the "school … as determined under State law" definition): https://www.law.cornell.edu/uscode/text/26/530 - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/homeschool-25f-eligibility-gap-half-cant-spend-2026 ### The math nobody budgeted for: finding a §25F donor can cost more than the cap lets an SGO spend on everything Date: 2026-06-30. Category: analysis. The federal Education Freedom Tax Credit (FSTC / ECCA / §25F) is often described as free money: a donor gives up to $1,700 to a Scholarship Granting Organization (SGO), claims the full amount back as a dollar-for-dollar federal credit, and a family gets a scholarship. On June 30, 2026, Chalkbeat's Matt Barnum surfaced the part of that picture the rally cries leave out, and it is the single most important number for anyone thinking about starting or running an SGO: the money is only free to the donor once the SGO has found that donor, and finding donors costs real dollars the credit does not reimburse. Here is the squeeze in one line. The American Federation for Children, a leading school-choice group, estimates internally that it could cost $300 or more in marketing to persuade a single taxpayer to make a §25F donation. AFC spokesman Brian Jodice put it in industry terms, a target of roughly $1 in spending to generate $5 in donations, which on a $1,700 gift works out to about $340. But §25F requires an SGO to spend at least 90 percent of its income on scholarships, which leaves a tenth of what it takes in, the equivalent of $170 on a $1,700 donation, for everything that is not a scholarship. That 10% has to cover staff, technology, audits, legal and compliance work, income verification, and donor acquisition combined. If it costs $300 to land a donor and the whole non-scholarship budget for that donor's gift is $170, the marketing alone is nearly double the entire allowance, before a single other bill is paid. Not everyone accepts the $300 figure, and the disagreement is itself instructive. Jim Blew, an adviser to the coalition implementing the credit, argued the real cost is closer to $100 per donor, still more than half the 10% cap by itself. Derrell Bradford, president of 50CAN, and Darla Romfo, president of the Children's Scholarship Fund, are among those looking for lower-cost ways to reach donors precisely because the cap makes expensive acquisition unsustainable at scale. The honest read is that nobody yet knows the true first-year number, because the program does not go live until January 1, 2027, and no one has run a §25F donor campaign at volume. What is not in dispute is the shape of the problem: donor acquisition is the largest single threat to a new SGO's budget, and the statute gives it the least room. The scale is what makes this a national story rather than an accounting footnote. The Trump administration's own projection assumes about 30% of eligible taxpayers, roughly 14 million people, will donate, producing around $24 billion for scholarships. Run the AFC's own $300 figure across 14 million donors and national marketing would run past $4.2 billion, money that by law cannot come out of the credited donations themselves. That is why AFC says it has already raised more than $10 million for a national awareness campaign funded outside the cap: the outreach that fills the top of the funnel has to be paid for with separate, non-credit dollars, because the 10% inside the credit will not stretch to cover it. For SGO operators, this is the number to build the whole model around, and it points to a clear strategy rather than a dead end. An SGO that spends $300 in paid marketing per donor is structurally underwater; one that acquires donors through channels it does not have to buy, an existing school community, a congregation, an alumni or parent network, a partner nonprofit's list, starts far closer to viable because those donors arrive at little or no acquisition cost. That is exactly why the SGOs best positioned for §25F are often the ones attached to an institution that already has a donor base, and why a brand-new SGO with no built-in audience faces the steepest climb. The other half of the answer is holding down the rest of that 10%: the more of the allowance an SGO burns on manual intake, eligibility checks, receipting, and audit prep, the less is left for finding donors at all. Purpose-built [§25F software that automates intake, income verification, donor receipting, and disbursement](https://eftccredit.com/learn/how-to-start-an-sgo) is one of the few levers an operator controls to keep administrative overhead low enough that donor outreach can fit inside the cap. None of this is an argument against the credit, and the groups raising it are among its strongest backers, which is the tell that it is an implementation problem, not a fatal flaw. Twenty-nine states are already on the IRS's official roster heading into the 2027 launch (our [participation map counts 30](https://eftccredit.com/states), including Kentucky, which opted in by veto override but has not yet completed the formal federal filing), and the demand for scholarships is real. But the difference between an SGO that thrives and one that quietly folds in year one will come down to a piece of arithmetic that the "free money" framing hides: cost per donor versus the 10% cap. Operators sizing up whether and how to launch can start with our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo), see the current national field in the [SGO directory](https://eftccredit.com/sgos), and track where each state stands on the [participation map](https://eftccredit.com/states). The credit going live is settled; who can afford to deliver it is the question this number decides. Sources: - Chalkbeat: The federal school choice tax credit comes with steep marketing costs (June 30, 2026): https://www.chalkbeat.org/2026/06/30/federal-school-choice-tax-credit-has-steep-marketing-costs/ - 26 U.S.C. §25F (federal Education Freedom Tax Credit, including the SGO expense limitation): https://www.law.cornell.edu/uscode/text/26/25F - American Federation for Children (national awareness campaign for the federal scholarship tax credit): https://www.federationforchildren.org/ Canonical: https://eftccredit.com/news/25f-sgo-marketing-cost-10-percent-cap-june-2026 ### The biggest prize in §25F is still on the table: a new California resolution urges Newsom to opt in and claim up to $4.9 billion in scholarships Date: 2026-06-24. Category: state-action. State: CA. California has spent the §25F wave on the sidelines, and on June 23, 2026 the question of whether it should stay there finally reached the floor of the Legislature. Assemblymember Josh Hoover introduced Assembly Concurrent Resolution 229, titled the "Federal Education Freedom Tax Credit," urging Gov. Gavin Newsom to "exercise his executive authority to promptly submit California's election to participate" in the federal program and directing state agencies to designate qualifying Scholarship Granting Organizations (SGOs) in time for the January 1, 2027 launch. Coauthored by Assembly Members Castillo, Hadwick, and Sanchez, it is the first formal legislative measure of any kind to press California's governor on §25F, and it arrives with a number attached that is hard to ignore: by the resolution's own estimate, if California opts in it could access up to $4.91 billion in scholarship contributions between 2027 and 2029 alone. It is worth being precise about what the resolution is and is not. A concurrent resolution expresses the will of the Legislature; it does not change law and cannot compel the governor to act. As of its latest action, ACR-229 had come from the printer and was awaiting committee referral, the earliest possible stage. In a Legislature with a Democratic supermajority, a resolution carried by Republican members faces an uncertain path to the floor. What it does accomplish, regardless of whether it advances, is to put the opt-in question on California's official legislative record for the first time and to frame it not as an abstract policy fight but as a concrete, quantified choice about federal dollars the state is currently declining to claim. California's actual status has not changed. Newsom has taken no public position on §25F, no bill to opt the state in or to authorize an SGO list has advanced in the 2025-2026 session, and California has neither filed Form 15714 nor submitted a list of Scholarship Granting Organizations to Treasury. That leaves the largest state in the country, and by extension the largest single pool of eligible families, absent from a program that [30 states have already joined](https://eftccredit.com/states). The cost of waiting is real but bounded: the opt-in decision is annual, so a governor who declines in 2027 can still elect in for 2028 or any later year. Every year California stays out, though, its residents' credit-eligible dollars flow to scholarship organizations in other states rather than to children at home. What makes ACR-229 notable is that it is the second distinct constituency to press Newsom on the same point from a very different direction. Earlier this year a grassroots effort out of a Los Angeles parish school, the [Purple Postcard Campaign](https://eftccredit.com/news/california-purple-postcard-campaign-newsom-25f-february-2026), mobilized more than 1,100 students and a Democratic-aligned coalition, including Democrats for Education Reform and the California Catholic Conference, to urge the governor to opt in. Now the case is being made inside the Capitol as well. The through-line in both is the argument that has moved governors across the spectrum: §25F does not spend a state's own money. It lets a state's residents redirect federal tax they would otherwise owe into scholarships for local children, which is why the choice increasingly reads less as an ideological stance than as a decision about whether to leave several billion dollars unclaimed. Where the broader field of Democratic governors has landed is tracked in our coverage of how [Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). For anyone weighing whether to build a California SGO, the practical signal is that pressure on Newsom is now coming from both the street and the statehouse, even if the governor's position remains unmoved and the timeline uncertain. Nothing about ACR-229 changes what an operator can do today, and California's sheer scale is the reason to be ready rather than to wait: if the state ever files its election, the demand for scholarship capacity would be larger than in any state already participating. Founders can track California's status and every other state's on our [California state page](https://eftccredit.com/states/california) and the [national participation map](https://eftccredit.com/states), see the field already forming in the [SGO directory](https://eftccredit.com/sgos), and use our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) to build the pieces that do not depend on any one governor's decision. The resolution will likely stall in a divided Legislature, but the number it put on the record, up to $4.91 billion, is the clearest statement yet of what California is choosing to forgo. Sources: - California Legislature: ACR-229, Federal Education Freedom Tax Credit (introduced June 23, 2026): https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202520260ACR229 - California Legislature: ACR-229 status and history: https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260ACR229 - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/california-acr229-hoover-urges-newsom-opt-in-25f-june-2026 ### New Hampshire passes a §25F implementing statute, putting its scholarship-credit machinery on Gov. Ayotte's desk Date: 2026-06-23. Category: state-action. State: NH. New Hampshire already told the federal government it was in. In January 2026, Gov. Kelly Ayotte [announced the state would participate](https://eftccredit.com/news/new-hampshire-ayotte-opts-in-25f-january-2026) in the federal Education Tax Credit for scholarship granting organizations created under §25F of the One Big Beautiful Bill Act, and New Hampshire appears on the IRS advance-election roster. What it did not yet have was a statute spelling out who, inside state government, actually runs the program. In June 2026 the legislature supplied one: both chambers gave final approval to House Bill 1774 and sent it to Gov. Ayotte's desk, where it awaits her signature. The bill divides the operational labor between two agencies. It directs the Department of Revenue Administration, "to the extent possible," to participate in the federal income tax credit for individual contributions to qualified scholarship granting organizations beginning in tax years ending after December 31, 2026, and to renew that participation automatically each year. It then tasks the Department of Education with creating New Hampshire's list of qualifying scholarship granting organizations (SGOs), submitting that list to the U.S. Treasury, publishing it on the state website, and certifying to the legislature that it has done so. Notably, the version that passed bars the agencies from adopting implementing rules, keeping the framework in statute rather than delegating it to a rulemaking process. The §25F language is bundled inside a broader bill that also addresses federal Workforce Pell grants, so the scholarship-credit provisions are one component of HB 1774 rather than its entire subject. The practical significance is the shift from an executive decision to a statutory one. Ayotte's January announcement was an advance election, the act of putting New Hampshire on the federal roster; a future governor could, in principle, reverse course on an executive opt-in. HB 1774 instead writes the participation duty and the automatic annual renewal into law and names the offices responsible for the SGO list, the donor-facing roster, and the reporting back to the legislature. It is the difference between saying yes and building the apparatus that makes the yes operate. With the federal credit going live January 1, 2027, that apparatus, especially the qualifying-SGO list, is the part that has to exist before any New Hampshire donor can claim the credit or any family can receive a scholarship. That list is also the gate every New Hampshire scholarship organization will have to clear. Once the Department of Education builds and submits it, only organizations on it can receive §25F-eligible contributions, so the months between now and the 2027 launch are the window in which existing nonprofits get qualified and new ones stand up. Children's Scholarship Fund New Hampshire is the most visible in-state candidate, but the program is open to any qualifying organization. Operators weighing whether to launch or expand one can review how the program works in our [explainers](https://eftccredit.com/learn) and see the current national field in the [SGO directory](https://eftccredit.com/sgos); the intake, eligibility-verification, and disbursement work behind a compliant program can run on software built specifically for §25F. New Hampshire's status, and what families need to know locally, is tracked on our [New Hampshire state page](https://eftccredit.com/states/new-hampshire). What remains is Ayotte's signature. As the Republican governor who announced the opt-in in the first place, she is the official the bill empowers rather than constrains, and her decision is the last step before the implementing framework becomes law. New Hampshire is one of the [more than two dozen states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) on the federal roster heading into the January 1, 2027 launch, and HB 1774 moves it from a state that has elected in to one with the statutory machinery to run a §25F program. The next milestone after a signature is the Department of Education's submission of the qualifying-SGO list to Treasury. The full national picture is mapped on our [state participation map](https://eftccredit.com/states). Update, July 2, 2026: Gov. Ayotte signed HB 1774 into law, in a batch of 74 bills signed at the close of the session. New Hampshire now has its §25F implementing statute on the books; the next milestone is the Department of Education's qualifying-SGO list, which, like every state's, waits on [Treasury's end-of-September proposed regulations](https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026). Sources: - New Hampshire Department of Revenue Administration: bill analysis of HB 1774 as amended by the House: https://www.revenue.nh.gov/sites/g/files/ehbemt736/files/documents/dra-bill-analysis-of-hb-1774-as-amended-by-the-house.pdf - New Hampshire Department of Revenue Administration: bill analysis of HB 1774 as introduced: https://www.revenue.nh.gov/sites/g/files/ehbemt736/files/documents/dra-bill-analysis-of-hb-1774-as-introduced.pdf - New Hampshire HB 1774 (2026) bill text and status: https://legiscan.com/NH/bill/HB1774/2026 - Citizens Count: HB 1774 (2026), qualifying scholarship granting organizations and federal workforce Pell grants: https://www.citizenscount.org/bills/hb-1774-2026 - IRS Newsroom: More than half the U.S. states signed up to participate (lists New Hampshire): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Office of Gov. Kelly Ayotte: Governor Signs 74 Bills into Law (July 2, 2026; includes HB 1774): https://www.governor.nh.gov/news/governor-signs-74-bills-law - InDepthNH: Ayotte signs 74 bills into law, including HB 1774 (July 2, 2026): https://indepthnh.org/2026/07/02/ayotte-vetoes-toll-hikes-for-out-of-staters-doubled-up-front-rental-costs-school-book-bans-signs-74-into-law/ Canonical: https://eftccredit.com/news/new-hampshire-hb1774-25f-implementing-statute-ayotte-desk-june-2026 ### Pennsylvania's House overhauls its scholarship-credit programs, and a top Democrat calls the federal §25F credit “intriguing” Date: 2026-06-22. Category: state-action. State: PA. Pennsylvania does not yet have a federal §25F decision, but on June 22, 2026 its House gave the clearest public read so far on how the state's Democratic majority thinks about scholarship tax credits. By a 105-97 vote, the chamber passed House Bill 2632, sponsored by Rep. Nikki Rivera (D-Lancaster), which would retire Pennsylvania's two long-running tax-credit-scholarship programs, the Educational Improvement Tax Credit (EITC) and the Opportunity Scholarship Tax Credit (OSTC), after the 2026-27 fiscal year and replace them, beginning in 2027-28, with a single new roughly $680 million "Education Options Tax Credit." The replacement redirects a large share of the credits toward students in low-income areas and underperforming schools, expands the eligible uses of scholarship money to include childcare, removes the per-pupil scholarship caps, and layers in new public-reporting and school-participation requirements. The bill now heads to the Senate. This is Pennsylvania's own state program, legally distinct from the federal credit, but it runs on the same machinery, donors, scholarship organizations, and a tax credit, that §25F federalizes, which is why the floor debate doubled as a preview of the federal question. The line most relevant to §25F did not come from the bill text but from the chamber's second-ranking Democrat. House Majority Leader Matt Bradford defended the overhaul on transparency grounds, arguing that "no one should ever fear transparency, especially when you're talking about three-quarters of a billion dollars of state tax dollars," and, notably, described parts of the federal scholarship credit as "intriguing." In a state that has not opted into the federal Scholarship Tax Credit (FSTC / ECCA / §25F), a senior House Democrat engaging the federal credit on its merits rather than rejecting it outright is the genuinely new signal here. It is a markedly warmer posture than the reflexive opposition the credit has drawn from public-education groups in other states, and it lands while the decision in Pennsylvania still belongs to the governor. That governor, Josh Shapiro, remains undecided. His office said it is reviewing HB 2632 and has not tipped whether his federal position has changed; he has repeatedly said he wants to wait for federal guidance to answer key questions before electing Pennsylvania into §25F, with the practical deadline at year-end. Shapiro is not a reflexive opponent of these programs, he has signed budgets that grew the state's tax-credit-scholarship funding by nearly half, even as he has resisted some Republican voucher expansions, which places him in the same watch-and-wait group as [Maryland's Wes Moore](https://eftccredit.com/news/maryland-wes-moore-25f-decision-pending-june-2026) and the other [pending states we have been tracking](https://eftccredit.com/news/pending-states-whats-at-stake-pennsylvania-may-2026). The takeaway for anyone reading Pennsylvania's tea leaves: the Democratic establishment here is moving to modernize and expand its scholarship-credit system, not dismantle it, which is the more telling backdrop for whether the state ultimately says yes to the federal credit. Not everyone reads HB 2632 as friendly, and an honest account has to note the fight. Catholic and private-school advocates warn that ending the existing EITC and OSTC and re-tiering eligibility could strand students who hold scholarships today, Lansdale Catholic publicly cautioned that 173 of its students could lose tuition aid, and the Commonwealth Foundation argued the committee version would leave tens of thousands of scholarship students at risk. Supporters, including progressive outlets that have long criticized the programs' lack of disclosure, call the reporting requirements overdue. For §25F specifically, the federal credit is governed by federal rules that states cannot rewrite, so Pennsylvania's redesign of its own program does not bind the federal one, but the same instinct on display here, route the money but attach transparency and targeting conditions, is exactly the impulse at the center of the national question of whether §25F is a [federal floor or a ceiling](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026) on what states can require. What it means going forward: Pennsylvania is one of the largest states still on the federal fence, and it is not starting from scratch. Its existing EITC and OSTC ecosystem already includes the scholarship organizations and donor relationships that, if the state elects in, could become §25F-eligible scholarship granting organizations, the same intake, eligibility-verification, and disbursement work a compliant program needs, which can run on [software built for §25F](https://eftccredit.com/learn/how-to-start-an-sgo). The bill now moves to the Senate, and Shapiro's federal decision is due by year-end; both are worth watching together, because the program design Pennsylvania settles on for its own credit will shape the terms it would want around the federal one. Operators sizing up the state can see the current national field in the [SGO directory](https://eftccredit.com/sgos), and Pennsylvania's status is tracked on our [Pennsylvania state page](https://eftccredit.com/states/pennsylvania) and the national [participation map](https://eftccredit.com/states). Sources: - The Philadelphia Inquirer: Pennsylvania Democrats weigh school choice as the federal tax credit looms (June 28, 2026): https://www.inquirer.com/politics/pennsylvania/school-choice-state-federal-funding-pennsylvania-democrats-josh-shapiro-20260628.html - Altoona Mirror: House passes measure to increase school choice program oversight (HB 2632, 105-97): https://www.altoonamirror.com/news/local-news/2026/06/pa-house-hb2632-school-choice-oversight-bill-advances/ - Pennsylvania General Assembly: House Bill 2632 (2025-2026 session), Appropriations fiscal note: https://www.legis.state.pa.us/WU01/LI/BI/FN/2025/0/HB2632P3598.pdf - Commonwealth Foundation: House Education Committee votes to cut school-choice scholarships: https://commonwealthfoundation.org/2026/06/16/house-education-votes-to-cut-school-choice-scholarships/ Canonical: https://eftccredit.com/news/pennsylvania-hb2632-eitc-overhaul-bradford-25f-june-2026 ### A week after Treasury's §25F preview: what tax advisers are telling clients, and how states are already reacting Date: 2026-06-19. Category: analysis. A week is long enough to tell the difference between an announcement and an event. When Treasury [previewed the forthcoming §25F regulations on June 10, 2026](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026), the document carried a disclaimer that it was "subject to ongoing legal review" and that nothing was law until the proposed rule publishes, expected no later than the end of September. Yet in the days since, the federal Scholarship Tax Credit (FSTC / ECCA / §25F) conversation has visibly moved off the question of what Treasury said and onto what people are doing about it. Two things happened in that week worth pulling together: tax advisers turned the preview into actionable client guidance almost immediately, and the preview's most contested signal, that states cannot bolt their own conditions onto participating Scholarship Granting Organizations (SGOs), started shaping live state decisions. Neither is a new federal action, which is why this is analysis rather than a fresh headline, but together they are the real story of the week. The professional-services reception was fast and strikingly uniform. Within days the accounting and tax bar, CLA, Foster Swift, Bonadio, Roth&Co, and Brownstein, plus the trade press at Accounting Today and Financial Planning, converted the preview into the same short build-now checklist: open a dedicated §25F segregated account so the 90%-of-income test can be measured against that account; budget for an annual independent financial and programmatic audit; and build donor receipting around the coming unique-donor-number system, under which an SGO never collects a donor's Social Security number. We have folded those items into our operator guides rather than restate them as if they were new here: the step-by-step [how-to-start-an-SGO checklist](https://eftccredit.com/learn/how-to-start-an-sgo#checklist) now carries them, alongside a clause-by-clause [walkthrough of the preview](https://eftccredit.com/learn/25f-proposed-regulations-preview). What made advisers willing to tell clients to act on a non-final document was one word, "reliance": Treasury said states, SGOs, and taxpayers can rely on the proposed regulations for tax year 2027. The lone caution every alert repeated: rely, but do not mistake a preview for the final rule. The preview's sharpest edge is not an operational detail but a question of power, and that is where the week's state news connects. Treasury previewed a "located in" standard and added that states "may not impose SGO-specific requirements more restrictive than §25F's own"; Deputy Assistant Secretary Kevin Salinger told stakeholders, more bluntly, that states cannot impose "substantive" rules on scholarship organizations beyond what federal law sets. That single line is the through-thread of the past week. [Vermont enacted Act 164 on June 18](https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026), a conditional opt-in that tries to steer the money toward public and approved-independent schools, exactly the kind of SGO-specific condition the preview signals is preempted, and the act's own clause tells the governor to decline if federal rules invalidate the conditions. Rhode Island built a legislative gate the same day, and Oregon's Gov. Kotek had already declined over this very complaint that Treasury would not let states write their own rules. The preview did not start that fight, but it told every state weighing an "opt in on our own terms" strategy that the terms may not be theirs to set, the unresolved question we examine in whether §25F is a [federal floor or a ceiling](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026). It is worth being precise about what the preview deliberately left unresolved, because those gaps are where the next month of practitioner attention will go. Treasury did not settle the joint-filer treatment of the $1,700 cap; the prevailing professional read, reflected in Brownstein's Q&A guidance, is that the credit will be limited to $1,700 per return rather than doubled for married couples, the same conclusion we reach in our explainer on why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026), but it remains expectation rather than rule. The preview also left the credit's coordination with the Alternative Minimum Tax unaddressed, deferred the scope of eligible expenses under section 530 (tutoring, special-needs services, and the like) to a separate later workstream, and did not finalize the state-list deadline mechanics for the 2027 startup year. None of these is trivia: the joint-filer answer changes the math for two-earner donor households, and the 530 expense list determines what a scholarship can actually pay for. The forward read has not changed, only firmed up. The binding date is still the end of September, when the proposed regulations are expected, and the program still goes live January 1, 2027. What the past week added is permission to act: because reliance is granted, an operator can build to the preview now while flagging the genuinely open items (joint-filer cap, AMT, 530 expenses) as subject to change. For founders doing exactly that, the [how-to-start-an-SGO guide](https://eftccredit.com/learn/how-to-start-an-sgo) carries the full checklist, and the [national participation map](https://eftccredit.com/states) tracks where each state has landed, including the ones now testing the limits of state authority. Sources: - U.S. Treasury press release: Treasury Previews Education Freedom Tax Credit Guidance (June 10, 2026): https://home.treasury.gov/news/press-releases/sb0527 - Treasury: Preview of Forthcoming Section 25F Guidance, remarks by DAS Kevin Salinger (PDF): https://home.treasury.gov/system/files/136/Preview-of-Forthcoming-Guidance.pdf - Accounting Today: Treasury plans guidance on new scholarship tax credit: https://www.accountingtoday.com/news/treasury-plans-guidance-on-new-scholarship-tax-credit - Current Federal Tax Developments: Treasury Previews Regulatory Framework for New Section 25F Education Freedom Tax Credit: https://www.currentfederaltaxdevelopments.com/blog/2026/6/11/treasury-previews-regulatory-framework-for-new-section-25f-education-freedom-tax-credit - CLA: IRS Guidance on SGOs and the Section 25F Tax Credit: https://www.claconnect.com/en/resources/blogs/nonprofits/irs-guidance-on-scholarship-granting-organizations-and-the-25f-tax-credit - Brownstein: Federal Scholarship Tax Credit Q&A Guide: https://www.bhfs.com/insight/federal-scholarship-tax-credit-qa-guide/ Canonical: https://eftccredit.com/news/25f-treasury-preview-one-week-later-what-changed-june-2026 ### Rhode Island's McKee signs the first-in-the-nation law stripping a governor's power to join §25F alone Date: 2026-06-18. Category: state-action. State: RI. Rhode Island Gov. Dan McKee, a Democrat, signed H7163 into law on Thursday, June 18, 2026, resolving a cliff-hanger we had been tracking and making Rhode Island the first state in the country to legally require both the legislature and the governor to agree before it can join the federal Education Freedom Tax Credit (§25F). McKee signed the measure the same day he signed a separate three-year moratorium on new public charter schools. The scholarship-tax-credit bill had cleared the General Assembly by veto-proof margins, 57 to 13 in the House and 34 to 4 in the Senate, with Rep. Susan Donovan and Sen. Sam Bell as lead sponsors, so a veto would likely have been overridden. We [first reported the bill's passage and transmittal](https://eftccredit.com/news/rhode-island-bill-requires-both-branches-approve-25f-opt-in-june-2026) on June 16. What McKee signed does not by itself decline §25F. It removes the governor's ability to enroll Rhode Island on his own through the IRS advance election ([Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025)) and instead requires an act of the General Assembly first. In his signing statement, McKee wrote that "scholarship-granting organization tax credits are, in practice, voucher programs that redirect public resources toward private institutions," and that "major decisions with long-term consequences for our students, schools, and taxpayers deserve thoughtful consideration and agreement among Rhode Island's elected leaders." He stopped short of slamming the door entirely, indicating he might support participation if Treasury's final guidance limited the credit to uses like "after-school tutoring, transportation, and educational technology, without supporting private school tuition." Reaffirming the line he has held for months, McKee said he is "not a voucher guy" but wanted to see the formal program rules first. The law is the most explicit version yet of a tactic Democratic-led states have reached for: rather than a flat gubernatorial refusal, it builds a structural barrier into the opt-in itself. Rhode Island's approach echoes [Vermont's H.933](https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026), which sought to condition any opt-in, and it goes a structural step beyond [Virginia, where the only sure exit still runs through a single governor's annual renewal decision](https://eftccredit.com/news/virginia-can-it-leave-25f-hb359-stalls-spanberger-renewal-june-2026) rather than a standing legal gate. It sharpens the unresolved federalism question we examine in our analysis of whether §25F is a [federal floor or a ceiling on state restrictions](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026). It is the inverse of the calculus that pushed [Oregon's Gov. Kotek to decline](https://eftccredit.com/news/oregon-kotek-declines-25f-treasury-state-rule-limits-june-2026) a week earlier: where Kotek objected that Treasury would not let states add their own SGO rules, Rhode Island's legislature moved to make sure no future governor could opt in without it. The signing drew reaction on both sides. Sen. Bell defended the measure by looking past the current administration: "I don't think Governor McKee would opt in, however, I don't know what future governors are going to do." That comment captures why the law exists at all: McKee could already keep Rhode Island out simply by never filing the advance election, so the bill's real target is not him but whoever holds the office next, converting a one-signature gubernatorial decision into one that requires an act of the General Assembly. Signing rather than vetoing also spared McKee a fight he would have lost, since the legislature's margins were large enough to override a veto. Opponents called it a missed opportunity for federal dollars that cost the state treasury nothing. Former Providence Mayor Jorge Elorza, now CEO of Democrats for Education Reform, had urged McKee to veto the bill, calling participation "such a no-brainer," and Republican House Minority Leader Michael Chippendale characterized the law as rejecting "free federal money." That zero-cost design, a participating state spends nothing of its own to open the door, is the counter-pressure that keeps the question alive even after a state erects a gate. For Rhode Island donors, families, and prospective scholarship organizations, the practical takeaway is that Rhode Island has no path into §25F before the program's January 1, 2027 launch unless the General Assembly passes a participation bill and a governor signs it. The bill does not change the federal credit's mechanics: donors in participating states can give up to $1,700 to a qualified Scholarship Granting Organization and claim a dollar-for-dollar federal credit, a figure that is fixed regardless of how the state-conditions fight resolves, as we explain in our coverage of why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). The broader opposition that produced this law, from teachers' unions to congressional Democrats pushing repeal, is detailed in our coverage of [who opposes §25F](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026). Rhode Island's status, now gated behind the legislature, is tracked on our [Rhode Island state page](https://eftccredit.com/states/rhode-island) and the [national participation map](https://eftccredit.com/states). Operators who want the back-office infrastructure ready in case Rhode Island ever acts can review how the organizations work in our [explainers](https://eftccredit.com/learn) and the current landscape in the [SGO directory](https://eftccredit.com/sgos). Sources: - Boston Globe: R.I. lawmakers vote to block governor from opting into Trump school choice program (June 18, 2026): https://www.bostonglobe.com/2026/06/18/metro/ri-bill-trump-school-voucher-program/ - WPRI / Yahoo News: McKee, longtime charter advocate, signs charter school freeze and the §25F both-branches bill (June 18, 2026): https://www.yahoo.com/news/politics/articles/mckee-longtime-charter-advocate-signs-182742719.html - BillTrack50: RI H7163 (2026), status “Signed by Governor (on 06/18/2026)”: https://www.billtrack50.com/billdetail/1940130 - Office of the Governor of Rhode Island: bills-signed-into-law press releases: https://governor.ri.gov/press-releases/governor-mckee-signs-bills-law-1 Canonical: https://eftccredit.com/news/rhode-island-mckee-signs-both-branches-gate-25f-june-2026 ### Can Virginia get out of §25F? A Democratic bill to block it stalled, and the real lever is Spanberger's to pull Date: 2026-06-17. Category: analysis. State: VA. Ever since outgoing Gov. Glenn Youngkin (R) made Virginia the [first state in the country to opt into](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) the federal Education Freedom Tax Credit (§25F) days before leaving office, Virginia Democrats and the state's teachers' union have been looking for a way back out. With the program not launching until January 1, 2027, the question has become one of the most-watched in the country: can a new administration unwind an opt-in its predecessor locked in? The short answer, as of mid-June 2026, is that Virginia has not left, and that there are exactly two routes out, one stalled and one untouched. This piece lays out where each actually stands, because the rumor that Virginia is "getting out" runs well ahead of the record. The legislative route was tried and stalled. The vehicle was HB 359, carried by Del. Dan Helmer (D-Fairfax), which never named §25F but would have effectively closed the door on it. Rather than repeal anything, the bill imposed a sweeping regulatory framework on any private school that accepts scholarships funded by a state or federal tax credit: mandatory participation in Virginia's Standards of Learning assessments, Board of Education accountability ratings, nondiscrimination rules barring admissions decisions based on a family's statement of faith, financial audits, teacher-credentialing requirements, and civil penalties for noncompliance. For many of the faith-based schools that §25F scholarships are meant to reach, those conditions would make participation impossible, which is the point: one Virginia Christian school warned the bill would "eliminate" its ability to take part in "the federal tax credit for private school scholarships that goes into effect next year." HB 359 was reported from the House Education Committee on a party-line 13-to-7 vote on February 9, 2026, then continued to the 2027 session in House Appropriations two days later, so it did not pass this year. Its official status on the Virginia Legislative Information System is simply "Continued." It is parked, not dead. The surer route never required a bill at all. Because the §25F opt-in is an annual election, a participating state's governor must resubmit a qualifying list of Scholarship Granting Organizations to the U.S. Treasury each year, a successor is not bound by a predecessor's choice in future years. Gov. Abigail Spanberger (D), who inherited Youngkin's opt-in, can keep Virginia out simply by declining to file the next election, no legislation, no veto fight. The Virginia Education Association has pressed exactly that, urging the state to "proactively reject participation" and the General Assembly to "preemptively prohibit" it, and citing its own estimate that participation could cost Virginia public schools between $222 million and $956 million a year once the credit takes effect. Spanberger's campaign education plan pledged to "reject efforts to divert funding from public education to pay for voucher programs." And yet she has not pulled that lever. As of mid-June 2026, Spanberger has issued no withdrawal, declined no renewal, and her office has not said when or whether she will, leaving Virginia formally opted in. The decision point is approaching rather than passed: Treasury's [June 10 preview of the forthcoming §25F regulations](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026) removed the "wait for final guidance" rationale critics had urged her to honor before deciding, and the program's 2027 launch sets a real deadline for the first renewal call that is unmistakably hers. It is worth not confusing two different Virginia programs here: the state's own Education Improvement Scholarships Tax Credit is a separate, pre-existing measure, and HB 359's reach over "state or federal" aid is what links it to §25F. Notably, Youngkin moved the other direction on his way out, expanding Virginia's approved SGO roster with five additional organizations in January 2026, so any reversal would mean unwinding a participation framework that is already built. Virginia's dilemma is now the template other states are copying in more explicit form. Where Virginia's exit hinges on one governor's discretion, [Rhode Island just enacted a law](https://eftccredit.com/news/rhode-island-mckee-signs-both-branches-gate-25f-june-2026) requiring both the legislature and the governor to approve any opt-in, and [Vermont's H.933](https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026) sought to condition participation the same way, sharpening the unresolved question of whether §25F is a [federal floor or a ceiling](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026) on what states may add. For Virginia donors, families, and prospective scholarship organizations, the practical takeaway is that nothing changes before the January 1, 2027 launch unless Spanberger declines to renew or a future General Assembly revives HB 359 and passes it. The federal credit's mechanics are unaffected either way: donors in participating states can give up to $1,700 to a qualified SGO and claim a dollar-for-dollar federal credit, a cap that is fixed regardless of how Virginia's fight resolves, as we explain in [why the credit is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). The broader opposition driving these moves is detailed in our coverage of [who opposes §25F](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026). Virginia's status is tracked on our [Virginia state page](https://eftccredit.com/states/virginia) and the [national participation map](https://eftccredit.com/states); operators weighing whether to stand up an SGO in case Virginia stays in can start with our [explainers](https://eftccredit.com/learn) and the [SGO directory](https://eftccredit.com/sgos). Sources: - Office of the Governor of Virginia: Youngkin announces Virginia is first state to opt in to the Education Freedom Tax Credit (Dec. 2025): https://www.governor.virginia.gov/newsroom/news-releases/2025/december/name-1077810-en.html - Virginia LIS: HB 359 (2026) bill details and history: https://lis.virginia.gov/bill-details/20261/HB359 - LegiScan: Virginia HB 359 (2026) votes and status: https://legiscan.com/VA/bill/HB359/2026 - FutureEd (Georgetown): 2026 state private-school-choice legislative tracker (HB 359 regulates schools taking state or federal tuition assistance): https://www.future-ed.org/legislative-tracker-2026-state-private-school-choice-bills/ - Regents School: What you need to know about HB 359 (would eliminate participation in the federal tax credit for private school scholarships): https://regents-school.org/article/2026-02-02-virginia-private-school-scholarships-threatened-what-you-need-to-know-about-hb-359 - Virginia Education Association: Federal vouchers, local consequences, what's at stake for Virginia's public schools: https://www.veanea.org/federal-vouchers-local-consequences-whats-at-stake-for-virginias-public-schools/ - Virginia Mercury / Dogwood: Federal school voucher program and the call to opt out in future years (May 29, 2026): https://vadogwood.com/news/federal-school-voucher-program-harms-virginias-most-vulnerable-families/ - WVVA: Virginia adds five more scholarship organizations to Education Freedom Tax Credit as demand soars (Jan. 16, 2026): https://www.wvva.com/2026/01/16/virginia-adds-five-more-scholarship-organizations-education-freedom-tax-credit-demand-soars/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/virginia-can-it-leave-25f-hb359-stalls-spanberger-renewal-june-2026 ### Rhode Island passes a first-in-the-nation bill requiring both branches to approve any §25F opt-in, and sends it to McKee Date: 2026-06-16. Category: state-action. State: RI. Rhode Island’s General Assembly has passed a first-in-the-nation measure aimed squarely at the federal Scholarship Tax Credit. On June 16, 2026, lawmakers transmitted H7163, with its Senate companion S2139, to Governor Dan McKee (D), a bill that prohibits Rhode Island from participating in the §25F scholarship-granting-organization tax credit unless both the General Assembly and the governor approve. The House passed it 57 to 13 and the Senate 34 to 4, with Rep. Susan Donovan and Sen. Sam Bell as lead sponsors. As of its transmittal the bill is not yet law: McKee has until late June to veto it or let it take effect, and his office said he was reviewing it. The bill’s official title leaves little doubt about its purpose. It "prohibits participation in federal school voucher tax credit for contributions to scholarship-granting organizations unless both the general assembly and the governor approve such participation." It references the enacting federal provision directly, Pub. L. 119-21, §70411 (2025), which created §25F. That credit lets individual taxpayers claim a dollar-for-dollar federal credit of up to $1,700 for donations to qualified Scholarship Granting Organizations, with the program taking effect January 1, 2027. The practical effect of the Rhode Island bill, if enacted, would be to remove the governor’s ability to enroll the state on his own and to require an act of the legislature first. McKee has not tipped his hand. He has said he is "not a voucher guy" but wants to see Treasury’s forthcoming regulations before deciding whether Rhode Island should participate at all. That posture leaves the state’s §25F status genuinely undecided, and the pending bill would gate any future decision behind the General Assembly. It is the most explicit version yet of a tactic other Democratic-led states have reached for: shaping or constraining how, or whether, a state plugs into the federal credit. Rhode Island’s approach echoes [Vermont’s H.933](https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026), which sought to condition its opt-in, and fits the broader question of whether states can add their own limits to the program that we examine in [our analysis of §25F as a federal floor or ceiling](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026). The Rhode Island move runs in the opposite direction from the wave of opt-ins elsewhere. Republican governors across the country have enrolled their states, and even some Democratic governors, including [New York’s Kathy Hochul](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026), have signaled intent to participate, while others have declined outright. The opposition that has organized against §25F, from teachers’ unions to congressional Democrats pushing repeal, is detailed in [our coverage of who opposes the credit](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026). Rhode Island is the first state to translate that opposition into a structural barrier on the opt-in itself rather than a flat refusal by the governor. What happens next is procedural but consequential. McKee can sign the bill, veto it, or allow it to become law without his signature; if it takes effect, Rhode Island would be the first state to legally require both branches to agree before joining §25F. For families and prospective scholarship organizations in the state, the bill does not by itself decide participation, it decides who gets to decide. We are tracking the governor’s action and Rhode Island’s status on our [Rhode Island state page](https://eftccredit.com/states/rhode-island) and the [national participation map](https://eftccredit.com/states), and will update this post when McKee acts. Update (June 18, 2026): McKee signed H7163 into law, making Rhode Island the first state to legally require both branches to approve any §25F opt-in. In a signing statement he called the credits "in practice, voucher programs," while leaving open the possibility of support if Treasury's final rules narrow the eligible uses. See our full report on [the signing](https://eftccredit.com/news/rhode-island-mckee-signs-both-branches-gate-25f-june-2026). Sources: - Boston Globe: R.I. lawmakers vote to block governor from opting into Trump school choice program (June 18, 2026): https://www.bostonglobe.com/2026/06/18/metro/ri-bill-trump-school-voucher-program/ - BillTrack50: RI H7163 (2026) bill detail, title, sponsor party, status and transmittal date: https://www.billtrack50.com/billdetail/1940130 - Office of the Governor of Rhode Island: bill-transmittal press releases: https://governor.ri.gov/press-releases/governor-mckee-signs-bills-law-12 Canonical: https://eftccredit.com/news/rhode-island-bill-requires-both-branches-approve-25f-opt-in-june-2026 ### Who's fighting §25F, and on what grounds: the unions, Democrats, and a repeal bill Date: 2026-06-15. Category: analysis. For donors weighing a contribution and operators thinking about launching a Scholarship Granting Organization, it's worth understanding who is fighting the federal Scholarship Tax Credit (FSTC / ECCA / §25F) and why, because the opposition is organized, well-funded, and unlikely to fade before the program launches January 1, 2027. It runs along three fronts: the national teachers' unions, Democratic lawmakers in Congress, and a handful of state education boards. The throughline is a single framing, that a tax credit for donations to scholarship organizations is a private-school voucher by another name, one that diverts public resources from public schools. The unions are the loudest voice. In a formal comment dated December 26, 2025, the National Education Association called §25F "a nationwide private school voucher program that diverts public resources away from public education." The position is not new: a joint NEA and AFT resolution, on the books since 1982, flatly opposes efforts to "direct public funds to non-public independent and church-run schools by means of tuition tax credits," arguing they damage the funding base of public schools and risk a "class education system." What's notable is the tactical shift in the NEA's 2025 comment, rather than seeking to kill the credit through the rulemaking, it asked Treasury for aggressive state oversight and to treat federal law as "a floor, not a ceiling" on state requirements, the precise position [Treasury's June preview appears to reject](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026). The unions sharpened the message in mid-2026: on June 23, AFT President Randi Weingarten and NEA President Becky Pringle issued a joint open letter urging every Democratic governor to refuse to opt in, calling §25F "a Trojan horse carrying near-universal K-12 private school vouchers" and pinning a roughly $50 billion annual price tag on it. The timing was deliberate, landing days before the NEA's July Representative Assembly and the AFT's July convention, but it is an exhortation rather than a legal lever: the unions cannot stop a state that has already opted in, and several Democratic governors have moved to participate anyway, with North Carolina's Josh Stein going so far as to look for ways to [route the credit toward public-school students](https://eftccredit.com/news/north-carolina-stein-public-school-sgo-pivot-25f-june-2026). The Representative Assembly itself, held July 3-7 in Denver, delivered the follow-through in rhetoric: NEA Executive Director Kim Anderson told delegates that "for the first time ever, we're up against a federal voucher program" and called for "more governors willing to reject it, state by state," naming Minnesota, Wisconsin, Oregon, and Rhode Island as the model. It is the same posture in a louder room, a campaign to persuade holdout governors, with no mechanism to reverse the 29 states already on the IRS's official roster or to move the January 1, 2027 launch date. The AFT followed at its own convention in Washington, adopting a resolution on July 19, 2026, "Keep Public Funds for Public Schools," that opposes the credit, referring to it by its public-law number as "the Federal Education Tax Credit established under P.L. 119-21," and pledges the union's support for the Keep Public Funds in Public Schools Act; notably the resolution never uses the terms "§25F" or "Education Freedom Tax Credit." Maryland Governor Wes Moore, speaking at that same convention, called the program a "tax scheme" that steers public funding toward private schools, his sharpest language yet, though Maryland has still made no formal decision. Like the letter and the assembly floor speeches, an adopted union resolution and a governor's rhetoric are exhortations, not levers: neither unwinds a completed state election nor changes the federal launch date. The legislative front is more direct. [Senate Democrats introduced a bill in April 2026 to repeal the credit outright](https://eftccredit.com/news/senate-democrats-introduce-ecca-repeal-bill-april-2026), a long shot in the current Congress but a marker of where the party's base sits, and in June 2026 House Democrats led by Reps. Gwen Moore and Mark Pocan added a companion bill, H.R. 9289, the "Keep Public Funds in Public Schools Act," introduced June 11 and referred to the Ways and Means Committee, making the repeal push bicameral. The House bill has drawn dozens of Democratic cosponsors but no Republican support and no committee action. Both are best read as position-setting rather than a near-term threat: §25F was enacted only last year through reconciliation, Republicans control both chambers, and there is no path to repeal over a presidential veto, so the statute's foundation is not in immediate danger. At the state level, the opposition has begun to harden from resolutions into actual law. On June 18, 2026, Rhode Island Governor Dan McKee signed H7163, a first-known "double-lock" statute that bars the state from opting into §25F unless both the General Assembly and the governor agree, stripping any future governor of the power to make the IRS advance election alone. Its near-term effect is small, McKee had shown no intention of opting in, and because the credit is federal rather than state-funded, Rhode Island donors can still contribute to qualifying Scholarship Granting Organizations in states that have opted in and claim the credit, but it is the clearest sign yet that opponents are moving from rhetoric to statute where they hold the votes. Michigan's State Board of Education voted in May 2026 to urge Governor Gretchen Whitmer not to opt the state in, and in Maryland the state teachers' union (MSEA) has warned that the program's roughly $50 billion in projected annual federal cost could crowd out other education funding. These are not fringe actors, they are the institutional core of the public-education establishment in blue and purple states. One feature of §25F is that Congress wrote it expecting a court fight. The statute gives any parent of a student who has received a scholarship the right to intervene to defend the law's constitutionality in any state or federal challenge, a clear nod to anticipated Establishment Clause litigation over public support flowing to religious schools. The precedent cuts toward the program's defenders: in a 2011 Arizona case, the U.S. Supreme Court held that taxpayers lacked standing to challenge a state tuition-tax-credit program, reasoning that a tax credit is not a government expenditure. For now the opposition to §25F is political and regulatory rather than judicial, but the intervention clause suggests the drafters expect that to change. We track each state's posture on the [participation map](https://eftccredit.com/states), and explain the program itself in [what is the FSTC](https://eftccredit.com/learn/what-is-fstc). Sources: - National Education Association: comment on Notice 2025-70 (Dec. 26, 2025): https://www.nea.org/advocating-for-change/action-center/letters-testimony/notice-2025-70-request-comments-individual-tax-credit-qualified-contributions-scholarship-granting - American Federation of Teachers: Joint NEA/AFT Resolution on Tuition Tax Credits: https://www.aft.org/resolution/joint-neaaft-resolution-tuition-tax-credits - American Federation of Teachers: resolution “Keep Public Funds for Public Schools: Oppose Vouchers” (89th Convention, adopted July 19, 2026): https://www.aft.org/resolution/keep-public-funds-public-schools-oppose-vouchers - NEA press release: Executive Director addresses delegates at the 105th Representative Assembly (July 5, 2026): https://www.nea.org/about-nea/media-center/press-releases/nea-executive-director-addresses-delegates-105th-representative-assembly - Chalkbeat: Will Whitmer opt Michigan in? Not if education board members have a say (May 12, 2026): https://www.chalkbeat.org/detroit/2026/05/12/michigan-state-board-education-opposes-federal-tax-credit-scholarship/ - WPR: Wisconsin congressional Democrats want to repeal national voucher for education (June 2026, House companion bill): https://www.wpr.org/news/wisconsin-congressional-democrats-want-repeal-national-voucher-for-education - Congress.gov: H.R. 9289, Keep Public Funds in Public Schools Act (introduced June 11, 2026): https://www.congress.gov/bill/119th-congress/house-bill/9289 - NEA / AFT: joint letter calling on Democratic governors to reject the federal voucher scheme (June 23, 2026): https://www.nea.org/about-nea/media-center/press-releases/aft-and-nea-call-democratic-governors-reject-trump-private-school-voucher-scheme - Rhode Island H7163: bill text (signed June 18, 2026, requires legislative + gubernatorial approval to opt into §25F): https://webserver.rilegislature.gov/BillText26/HouseText26/H7163.pdf Canonical: https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026 ### Maryland is a marquee §25F holdout, and Wes Moore isn't tipping his hand Date: 2026-06-14. Category: state-action. State: MD. Maryland has become one of the most-watched holdouts on the federal Scholarship Tax Credit (FSTC / ECCA / §25F), and Governor Wes Moore is keeping his options open. As the program's January 1, 2027 launch approaches, the Moore administration has declined to comment on whether the state will participate, and the Maryland State Department of Education has not taken a position. That silence is itself notable: Moore is a high-profile Democrat in a state where the decision carries real money and real political risk in both directions. The case for opting in rests on the fact that it costs the state nothing, the scholarships are funded by donors claiming a federal credit, not by Maryland's budget. Analysts have pressed the point that public schools are not shut out. Georgetown University researcher Marguerite Roza has estimated that Maryland public-school districts could raise upwards of $34 million by setting up their own Scholarship Granting Organizations, on the order of 20,000 donors contributing the maximum $1,700 credit each, to fund tutoring, transportation, technology, and specialized services for their own students. School-choice advocates have been blunter still, with one calling it "governance malpractice" for Moore not to opt in, given that Maryland residents are already eligible to donate but cannot claim the credit unless the state participates. The case against is mostly political and fiscal. The Maryland State Education Association has warned that the program's roughly $50 billion in projected annual federal cost could ultimately reduce other federal education funding, and critics point to a largely unregulated scholarship market and the risk of enrollment and funding losses for traditional public schools. Underneath it all is the voucher framing that drives union opposition nationally, the concern that a program nominally open to public-school students is fundamentally designed to move money toward private tuition. Two timing facts shape Moore's decision. There is no single statutory deadline, but Maryland must elect to participate before the credit becomes available for the 2027 tax year, and Scholarship Granting Organizations need lead time to be designated and to begin collecting donations. And the calculus just narrowed: [Treasury's June preview signaled that states cannot attach their own restrictions](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026), such as limiting the money to public schools, which removes the conditional middle path a governor like Moore might have preferred and leaves a cleaner in-or-out choice. Maryland's current status, and every other state's, is tracked on our [Maryland state page](https://eftccredit.com/states/maryland); founders can see who is already operating on the [SGO directory](https://eftccredit.com/sgos). Sources: - The Baltimore Banner: Will Maryland Gov. Wes Moore opt in to a federal school voucher plan?: https://www.thebanner.com/education/k-12-schools/maryland-school-voucher-sgo-GCB4W5HWJFCVBGALCZHOOGZTAQ/ - Defense of Freedom Institute: EFTC State Participation Status tracker: https://dfipolicy.org/education-freedom-tax-credit/ Canonical: https://eftccredit.com/news/maryland-wes-moore-25f-decision-pending-june-2026 ### Vermont wants into §25F on its own terms, steering the money toward public schools. The federal rules may not let it. Date: 2026-06-13. Category: state-action. State: VT. Most of the fight over the federal Scholarship Tax Credit (FSTC / ECCA / §25F) has been binary: a state opts in, or it doesn't. Vermont is testing a third option, opt in, but rewrite the program so the money lands where the legislature wants it. On May 29, 2026 the Vermont House passed H.933, a miscellaneous tax bill that, among dozens of unrelated provisions, sets up a state framework for participating in §25F. The bill was delivered to Governor Phil Scott on June 12, 2026. As of this writing he has neither signed nor vetoed it. What makes H.933 unusual is not that it opts Vermont in, it's the conditions attached. Rather than simply authorizing the Governor to submit a list of Scholarship Granting Organizations to the U.S. Treasury, the bill narrows which organizations can be listed: they must be nonprofits whose core mission is providing educational opportunities to economically underprivileged students, and grants are steered toward students attending public schools or approved independent schools capable of receiving public tuition, rather than private or religious tuition broadly. Lawmakers were candid about the goal, which was to channel the federal credit toward Vermont's public-school population. The bill also includes a self-limiting clause: if federal regulations invalidate the state's guidance, the Governor is to decline to participate until the General Assembly enacts new legislation addressing the conflict. So this is a narrowed, conditional opt-in, not the flat opt-out some have described, and the Governor's authority to participate is intact rather than stripped. Vermont is the sharpest version of an impulse several Democratic-leaning states have shared. Through the spring, governors and legislators floated conditioning participation on serving low-income families, prioritizing students with disabilities, requiring academic standards, or confining the dollars to public schools. The instinct is understandable given how §25F is structured, donors, not the state treasury, fund the scholarships, but the state controls the list of eligible organizations, which looks like a lever for shaping the program. Vermont simply pulled that lever the hardest and wrote the restrictions into statute. The problem is that Treasury has signaled the lever may not exist. In its June 2026 preview of the forthcoming §25F regulations, Treasury defined the "located in" standard for SGOs and stated that states may not impose SGO-specific requirements more restrictive than §25F's own, and it said "school" will be defined consistent with section 530 to include public, private, and religious K-12 schools as determined under state law. Deputy Assistant Secretary Kevin Salinger told stakeholders that states cannot impose "substantive" rules on scholarship organizations beyond what federal law sets, a position that contradicted Education Secretary Linda McMahon's earlier assurances to Congress that states would shape their own programs. If that holds in the final rule, Vermont's economically-underprivileged-only and public-schools-first conditions would be preempted, and by the terms of H.933's own clause, that could trigger the Governor to decline participation until lawmakers rewrite the statute. For donors, families, and prospective SGO founders, Vermont is worth watching as a bellwether rather than a settled outcome. It tests whether a state can accept the federal credit while redirecting it away from the private and religious schools the statute was written to fund, and the answer will come from Treasury's final regulations, expected by the end of September 2026, as much as from Montpelier. We've covered [what Treasury previewed about state authority and the SGO rules](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026), the [veto-override route other divided states have used](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026), and [where Democratic governors have landed](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). Vermont's current status, and every other state's, is tracked on our [Vermont state page](https://eftccredit.com/states/vermont) and the [state participation map](https://eftccredit.com/states). Update, June 18, 2026: Governor Phil Scott signed H.933 into law as Act 164. Enactment makes Vermont's conditional, public-schools-first §25F framework binding statute, but it does not change the analysis above: because Act 164 directs the Governor to decline participation if federal regulations invalidate the state's conditions, and Treasury's preview signals those conditions are likely preempted, whether Vermont ends up in or out of §25F still turns on the final regulations expected by the end of September 2026. Sources: - Vermont Legislature: H.933 (2026) signed by the Governor June 18, 2026 as Act 164 (bill status): https://legislature.vermont.gov/bill/status/2026/H.933 - VTDigger: Vermont lawmakers hope to steer new federal school choice tax credit funds toward public schools (Apr. 24, 2026): https://vtdigger.org/2026/04/24/vermont-lawmakers-hope-to-steer-new-federal-school-choice-tax-credit-funds-toward-public-schools/ - Vermont Legislature: H.933 bill status (delivered to Governor June 12, 2026): https://legislature.vermont.gov/bill/status/2026/H.933 - Chalkbeat: McMahon said states would shape tax credit scholarship. Treasury said no. (June 11, 2026): https://www.chalkbeat.org/2026/06/11/treasury-previews-tax-credit-scholarship-rules-that-shape-school-choice/ - U.S. Treasury press release: Treasury Previews Education Freedom Tax Credit Guidance (June 10, 2026): https://home.treasury.gov/news/press-releases/sb0527 Canonical: https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026 ### Arizona's §25F opt-in died in budget negotiations: the language was in the vetoed GOP tax omnibus but absent from the signed bipartisan budget Date: 2026-06-13. Category: state-action. State: AZ. After Gov. Katie Hobbs vetoed two standalone bills to join the federal Scholarship Tax Credit (FSTC / ECCA / §25F), Arizona Republicans tried a third route this session: they folded the opt-in into their proposed 2026-27 budget tax omnibus, HB 4152. That bill went well beyond a one-line election. It added an entirely new chapter to Arizona's tax code, A.R.S. Title 43, Chapter 18, titled "Scholarship Granting Organizations," whose lead section, §43-1801(A), reads in full capitals: "THIS STATE ELECTS TO PARTICIPATE IN THE FEDERAL TAX CREDIT ESTABLISHED BY SECTION 25F OF THE INTERNAL REVENUE CODE FOR INDIVIDUALS WHO MAKE QUALIFIED CONTRIBUTIONS TO SCHOLARSHIP GRANTING ORGANIZATIONS." The bill directed the Arizona Department of Revenue to certify SGOs that meet the §25F requirements and to submit that list to the U.S. Secretary of the Treasury, effective for taxable years beginning after December 31, 2026 (that is, the program's January 1, 2027 start). The opt-in never survived contact with the budget fight. On May 5, 2026, Hobbs vetoed the entire Republican budget package, House Bills 4138 through 4153, en masse, rejecting the roughly $17.9 billion plan as "unbalanced and reckless" and calling for negotiations to resume. HB 4152, the tax omnibus carrying the §25F election, was one of the bills caught in that mass veto. There was no override. Instead, the two sides negotiated a replacement, and the §25F opt-in did not make the cut. This is the same fundamental objection Hobbs has voiced before: in vetoing the earlier standalone bills she pointed to a lack of accountability guardrails and the absence of final federal guidance, the reasoning detailed in our coverage of her [January veto of SB 1106](https://eftccredit.com/news/arizona-governor-hobbs-vetoes-fstc-opt-in-january-2026) and her [April veto of SB 1142](https://eftccredit.com/news/arizona-governor-hobbs-vetoes-second-opt-in-bill-april-2026). The budget Hobbs ultimately signed on June 13, 2026, the bipartisan tax omnibus HB 4168 (a roughly $18.3 billion package), is silent on the question. A full-text review of the engrossed bill turns up no §25F election, no "Scholarship Granting Organizations" chapter, no certification mandate, and no instruction to submit any list to the Secretary of the Treasury. The opt-in language present in the vetoed HB 4152 was simply not carried over into the compromise that became law. In other words, the provision was not defeated on its merits in a floor vote; it was dropped as part of reaching a bipartisan deal, the most quietly fatal way for a policy to disappear. The net result is that, across three vehicles in a single session (SB 1106 in January, SB 1142 in April, and now HB 4152 inside the vetoed budget), Arizona has declined to opt in, and the signed budget locks that posture in for now. Unless a future session revives the language or a future governor acts, Arizona will not have certified SGOs and will not appear on the Treasury participating list when §25F goes live on January 1, 2027. That outcome is striking given that Arizona runs one of the country's largest existing state scholarship and Empowerment Scholarship Account programs and already has mature SGO infrastructure. Arizona donors can still claim the federal credit (up to $1,700 per taxpayer) by giving to SGOs in states that have opted in, though those scholarships would fund students elsewhere. We track Arizona's status and every other state's on our [Arizona state page](https://eftccredit.com/states/arizona) and the [state participation map](https://eftccredit.com/states); founders and operators can start with our [explainer on how the credit works](https://eftccredit.com/learn) and our [directory of Scholarship Granting Organizations](https://eftccredit.com/sgos). Sources: - HB 4152 engrossed bill text (azleg.gov): new A.R.S. Title 43, Chapter 18 'Scholarship Granting Organizations,' §43-1801 §25F election: https://www.azleg.gov/legtext/57leg/2R/bills/HB4152H.pdf - HB 4152 House Bill Summary (azleg.gov): 'Declares that Arizona elects to participate in the federal tax credit for individuals who make qualified contributions to SGOs': https://www.azleg.gov/legtext/57leg/2R/summary/H.HB4152_042826_CAUCUSCOW.DOCX.htm - HB 4168 engrossed bill text (azleg.gov): the signed bipartisan tax omnibus, containing no §25F / SGO language: https://www.azleg.gov/legtext/57leg/2R/bills/HB4168H.pdf - Arizona Capitol Times: Hobbs signs $18.3B bipartisan budget (June 13, 2026): https://azcapitoltimes.com/news/2026/06/13/hobbs-signs-18-3-billion-bipartisan-budget/ - Arizona Mirror: Hobbs vetoes 'unbalanced and reckless' Republican budget (May 5, 2026): https://azmirror.com/2026/05/05/hobbs-vetoes-unbalanced-and-reckless-republican-budget-calls-for-negotiations-to-resume/ - Phoenix New Times veto tracker: HB 4138-4153 vetoed en masse May 5, 2026 as the GOP budget: https://www.phoenixnewtimes.com/news/arizona-governor-katie-hobbs-veto-tracker-2026-40648356/ Canonical: https://eftccredit.com/news/arizona-25f-opt-in-stripped-from-signed-budget-hb4168-june-2026 ### Floor or ceiling? Treasury's §25F preview signals states can't add their own restrictions Date: 2026-06-12. Category: analysis. Most of the §25F coverage has been a headcount, which states are in, which are out. The more consequential fight is quieter and structural: when a state opts into the federal Scholarship Tax Credit (FSTC / ECCA / §25F), does federal law set a floor that the state can build higher rules on top of, or a ceiling the state has to accept as written? That single question decides whether a participating state can steer the money toward public schools, limit eligible organizations to those serving low-income families, or attach its own academic and accountability tests. Treasury's June 2026 preview pointed clearly toward ceiling. In remarks on June 9, 2026 and an accompanying release on June 10, Deputy Assistant Secretary for Tax Policy Kevin Salinger previewed the forthcoming proposed regulations. On the question that matters here, Treasury indicated that an organization is "located in" a state if it is authorized to do business there and complies with the state's generally applicable charitable-organization rules for transparency, accountability, and fraud prevention, and that states may not impose organization-specific requirements more restrictive than §25F's own. As Chalkbeat summarized it, states cannot impose "substantive" rules on scholarship groups beyond what federal law sets, a reading that contradicted assurances Education Secretary Linda McMahon had given that states would shape their own programs. Treasury also said "school" will be defined consistent with section 530 to include public, private, and religious K-12 schools as determined under state law. The floor-versus-ceiling framing is not abstract, it is exactly what the program's opponents asked for. In a formal comment dated December 26, 2025, the National Education Association urged Treasury to acknowledge that federal law sets "a floor, not a ceiling" on state requirements for certifying scholarship organizations, and to require robust state oversight. Vermont went further and legislated the strings directly, with [H.933 narrowing eligible organizations to nonprofits serving economically underprivileged students and steering grants toward public and approved independent schools](https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026). And several undecided Democratic governors, Gretchen Whitmer in Michigan, Ned Lamont in Connecticut, and Wes Moore in Maryland, had largely been waiting for the federal rules before committing, with public-school priorities clearly on their minds. Treasury's preview points away from all of it. If the proposed regulations hold this line when they publish, expected by the end of September 2026, the practical effect is to collapse a three-way choice into a binary. A state can opt in on federal terms or stay out; the "opt in but wall it off" option largely disappears. Vermont's own bill anticipates this, directing the Governor to decline participation if federal rules invalidate the state's guidance until the legislature acts again. For donors and Scholarship Granting Organizations, a ceiling is the friendlier outcome: a more uniform national program with fewer state-by-state eligibility traps. We've covered [the full preview of the proposed rules](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026) and [where Democratic governors have landed](https://eftccredit.com/news/democratic-governors-split-on-25f-2026); current status for every state is on the [participation map](https://eftccredit.com/states). Sources: - Chalkbeat: McMahon said states would shape tax credit scholarship. Treasury said no. (June 11, 2026): https://www.chalkbeat.org/2026/06/11/treasury-previews-tax-credit-scholarship-rules-that-shape-school-choice/ - U.S. Treasury press release: Treasury Previews Education Freedom Tax Credit Guidance (June 10, 2026): https://home.treasury.gov/news/press-releases/sb0527 - National Education Association: comment on Notice 2025-70 (Dec. 26, 2025): https://www.nea.org/advocating-for-change/action-center/letters-testimony/notice-2025-70-request-comments-individual-tax-credit-qualified-contributions-scholarship-granting Canonical: https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026 ### Oregon Gov. Kotek declines §25F after reconsidering, citing Treasury limits on state SGO rules Date: 2026-06-12. Category: state-action. State: OR. Oregon Gov. Tina Kotek, a Democrat, announced on Friday, June 12, 2026 that Oregon will not opt into the federal Education Freedom Tax Credit (§25F), the dollar-for-dollar tax credit of up to $1,700 per taxpayer for donations to qualifying Scholarship Granting Organizations (SGOs). As reported by Education Week, Kotek pointed to Treasury's recent information release confirming it would not let states "impose substantive SGO-specific requirements that are more restrictive" than federal law, and said that limitation "indicates states like Oregon will not have the flexibility they need to participate in alignment with our values." The decision is a non-election, not a formal filing: declining §25F simply means Oregon's governor does not submit the IRS advance election (Form 15714) or designate state SGOs, so the program never turns on for Oregon residents. Oregon does not appear among the participating states on the IRS newsroom roster dated June 8, 2026, which listed 27 states; Education Week reports 31 states on track nationally. What makes the announcement notable is the arc behind it. Kotek was among the first Democratic governors last summer to say no, then reconsidered: in early March 2026 a spokesperson said she "has not determined" whether Oregon would participate and was awaiting Treasury's regulations before deciding. The June statement closes that reopened question with a no, and the reason she gave is the same federalism fight now shaping decisions in capitals across the country. The credit's mechanics are not in dispute: donors anywhere can give up to $1,700 to a qualifying SGO and claim a dollar-for-dollar federal income tax credit, with the SGO awarding K-12 scholarships and the program set to launch January 1, 2027. The fight is over how much a participating state can shape its own SGO list, and Treasury's guidance suggested the answer is "less than blue states had hoped." We track that dispute in our coverage of whether §25F is a [federal floor or a ceiling on state restrictions](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026) and what [Treasury previewed about state authority](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026). Kotek's rationale is the inverse of the calculus that has driven Republican-led states in. Oklahoma, for example, deliberately barred its agencies from adding rules beyond federal law precisely so its program would track Treasury's national framework rather than layer on state guardrails. Kotek wanted the opposite: room to attach Oregon-specific conditions to participating SGOs, and on reading Treasury's release she concluded that room does not exist. The result places Oregon in the declining column alongside other Democratic-led states that have balked, a pattern we examine in our coverage of [how Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). It stands in contrast to early movers across the aisle and beyond it, from [Virginia, the first state to opt in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), to [New York under Gov. Hochul](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026). For donors, families, and prospective SGO founders, the practical takeaway is that Oregon is a non-participating state with no clear path to reverse course before the January 1, 2027 launch. There is no Oregon program to plan around: Oregon residents will see no in-state SGOs to give to, and Oregon families cannot receive §25F scholarships, even though the federal credit exists for taxpayers in states that elect in. Because the credit is statutorily capped at $1,700 per taxpayer regardless of how the state-conditions fight resolves, a point we lay out in our explainer on why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026), Oregon's exit changes nothing about the dollar figures and everything about access. Oregon's current status, and every other state's, is tracked on our [Oregon state page](https://eftccredit.com/states/oregon) and the [national participation map](https://eftccredit.com/states). Operators who still want the infrastructure ready in case Oregon ever reverses can review how the organizations work in our [explainers](https://eftccredit.com/learn) and the current landscape in the [SGO directory](https://eftccredit.com/sgos); the back-office work of intake, eligibility checks, and scholarship disbursement can be run on software built specifically for §25F. The forward question is whether the same Treasury guidance that pushed Kotek out becomes the wedge that other governors use to stay out. Her objection is not to school choice in the abstract but to losing control over the rules, and if Treasury's final regulations confirm a strong federal ceiling on state conditions, more Democratic governors may reach the same conclusion she did. The counter-pressure is the program's zero-cost design: a participating state spends nothing from its own treasury to open the door, which keeps the question alive even after a sitting governor says no. For now, whether Oregon ever files an advance election will be measured by one thing, and Kotek has answered it for this cycle with a no. Sources: - Education Week: Another Democratic-Leaning State Will Pass on the Federal School Choice Program (June 12, 2026): https://www.edweek.org/policy-politics/another-democratic-leaning-state-will-pass-on-the-federal-school-choice-program/2026/06 - IRS Newsroom: More than half the US states signed up to participate in the federal scholarship tax credit program (June 8, 2026): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Teach Coalition National Tracker (Oregon listed as declining): https://teachcoalition.org/federalscholarships/ Canonical: https://eftccredit.com/news/oregon-kotek-declines-25f-treasury-state-rule-limits-june-2026 ### Massachusetts stays on the sidelines: Healey awaits Treasury rules as a business coalition and the teachers union clash over the §25F credit Date: 2026-06-12. Category: state-action. State: MA. Massachusetts is sitting out the federal Education Freedom Tax Credit (§25F) for now. The state is absent from the IRS roster of 27 states that have filed advance elections to participate, published as [IR-2026-76](https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill) on June 8, 2026. Gov. Maura Healey, a Democrat, has not committed either way: after Treasury previewed its regulatory framework the week of June 8, her administration said it is waiting on formal guidance from the U.S. Treasury and the Department of Education, expected by the end of September 2026, before deciding whether to opt in (Boston Globe; State House News, June 11, 2026). The posture leaves Massachusetts off the participation list even as a high-profile business coalition and the state's largest teachers union square off over the question, a fight the Boston Globe broke open in its June 12, 2026 newsletter. On one side is a coalition spearheaded by Boston investor Peter Lynch and his family foundation, joined by the Greater Boston Chamber of Commerce, the Worcester Regional Chamber of Commerce, the Massachusetts Business Roundtable, and The Boston Foundation, all pressing Healey to participate (Boston Globe, June 12, 2026). The push has Republican backing as well: State House News reported the same week that GOP lawmakers, the Pioneer Institute, former Lt. Gov. Tim Murray of the Worcester Regional Chamber, and Republican gubernatorial candidate Mike Minogue have all urged Massachusetts not to miss out. On the other side, Massachusetts Teachers Association president Max Page, co-signed by Vice President Deb McCarthy, sent Healey a letter (delivered around June 10 to 11) arguing the credit would drain resources from public schools and framing it as part of a Republican voucher movement. The mechanics behind the standoff are straightforward. Under §25F, a state opts in when its governor files an advance election with the IRS (Form 15714) and designates qualifying Scholarship Granting Organizations (SGOs). Donors anywhere in the country can then claim a dollar-for-dollar federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO, which awards K-12 scholarships to families earning up to 300% of their area median gross income. The credit goes live January 1, 2027, and the program was created by the One Big Beautiful Bill Act. Critically, Treasury has only previewed its framework: the actual proposed regulations are not expected until the end of September 2026, which is precisely the guidance Healey says she is waiting on. We cover that timeline in our report on the [Treasury §25F preview](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026), and the statutory cap detail in our explainer on why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). For donors, families, and prospective SGO founders, the practical takeaway is that Massachusetts remains a non-participating state. There is no Massachusetts program to plan around yet: its residents see no in-state SGOs to give to, and its families cannot receive the scholarships, even though the federal credit exists nationally. Massachusetts's current status, and every other state's, is tracked on our [Massachusetts state page](https://eftccredit.com/states/massachusetts) and the [national participation map](https://eftccredit.com/states). Operators weighing whether to stand up one of Massachusetts's first SGOs, so the infrastructure exists if and when the state elects in, can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current landscape in the [SGO directory](https://eftccredit.com/sgos); the back-office work of donor intake, eligibility checks, and scholarship disbursement can be run on software built specifically for §25F. The forward question is whether the late-September guidance arrives in time to force Healey's hand before the January 1, 2027 launch. The longer Massachusetts goes without filing an advance election, the longer its donors hold credit-eligible dollars with no in-state place to send them and the more pressure builds from the business coalition lining up against the teachers union. Massachusetts is not alone in this hesitation: it joins a broader group of blue states where the decision turns on the same waiting game, a pattern we track in our coverage of how [Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). Whether Healey's "wait for the rules" stance becomes a yes will be measured by one thing: whether Massachusetts ever files an advance election with the IRS. Sources: - IRS IR-2026-76: more than half the US states signed up to participate in the federal scholarship tax credit program (27-state roster, Massachusetts absent): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Boston Globe: Business groups and Mass. teachers battle over a federal tax credit (June 12, 2026): https://www.bostonglobe.com/2026/06/12/newsletters/schools-tax-credit-power-play/ - State House News: Critics say Massachusetts missing out on chance to lift education (June 11, 2026): https://www.statehousenews.com/news/education/critics-say-massachusetts-missing-out-on-chance-to-lift-education/article_89e88e39-fda5-4b30-ab65-328d04c2f8ae.html - New Boston Post: Maura Healey faces pressure to opt Massachusetts into federal scholarship tax credit (June 11, 2026): https://www.newbostonpost.com/maura-healey-faces-pressure-to-opt-massachusetts-into-federal-school-scholarship-tax-credit/ Canonical: https://eftccredit.com/news/massachusetts-healey-awaits-treasury-rules-25f-pressure-june-2026 ### Treasury previews the §25F proposed regulations: September timeline, a 90% safe harbor, and a multistate path Date: 2026-06-10. Category: regulatory. The single most consequential open item in the federal Scholarship Tax Credit (FSTC / ECCA / §25F) program now has a date and a shape. On June 9, 2026, Deputy Assistant Secretary for Tax Policy Kevin Salinger told a roundtable of Scholarship Granting Organizations, state representatives, and education stakeholders that Treasury and the IRS expect to issue the §25F proposed regulations "no later than the end of September", and that states, SGOs, and taxpayers will be able to rely on those proposed regulations for tax year 2027. Treasury published the remarks and an accompanying press release on June 10, branding the program the "Education Freedom Tax Credit." Treasury Secretary Scott Bessent said the department is "committed to providing certainty to states, scholarship-granting organizations, taxpayers, and families alike." The preview resolves several questions SGO founders have been building around blind. On the statute's 90%-of-income spending requirement, Treasury expects the rules to measure the test against the organization's total receipts, unreduced by expenses, but with a safe harbor: an organization whose activities are largely scholarship-granting can instead measure "income of the organization" by the amount held in a §25F segregated account, including qualified contributions and earnings. For multistate SGOs, the safe harbor must be satisfied separately for each state-specific segregated account. Treasury also defined the long-ambiguous "located in" standard: an SGO is located in a state if it is authorized to do business there and complies with the state's generally applicable charitable-organization rules, and states may not impose SGO-specific requirements more restrictive than §25F's own. The multistate question, whether one SGO can serve families in several participating states, gets an explicit yes. An SGO may appear on more than one state's list as long as it is located in each state and maintains a separate §25F account per state, with most operational requirements applied per-account. On student eligibility, Treasury previewed a layered verification regime: direct income documentation (paystubs, tax returns, IRS transcripts, W-2s, or commercial data sources), categorical eligibility based on a household member's participation in a needs-based federal, state, or tribal program, and a safe harbor treating foster children as income-qualified with no separate verification. "School" will be defined consistent with section 530 to include public, private, and religious K-12 schools as determined under state law, including home schools where state law treats them as schools, and schools operated by federally recognized Tribes. Compliance architecture got equal billing. Every SGO would need an annual financial and programmatic audit by a qualified independent third party, furnished to each state on whose list it appears, though smaller SGOs could substitute an internal-committee audit signed under penalties of perjury. On the donor side, Treasury previewed a unique-donor-number system: the SGO issues each donor a written acknowledgment with a number generated under an IRS-provided method, reports contributions to the IRS under that number, and the donor reports it on their federal return, letting the IRS match claimed credits to real donors and real SGOs without donors ever giving an SGO their Social Security number. Treasury also said the proposed rules will contemplate an IRS portal for SGO administration and reporting, built out in phases. Two caveats temper the good news. First, the preview is "subject to ongoing legal review", Treasury intends the proposed regulations to be consistent with it, but nothing is law until the rule publishes. Second, some open items weren't addressed: the joint-filer treatment of the $1,700 cap, coordination with the Alternative Minimum Tax, and the state-list deadline mechanics for the 2027 startup year all remain to be settled. Guidance on the scope of eligible expenses under section 530, including tutoring and special-needs services, which Treasury says it "fully intend[s]" scholarships to support, will come as a separate workstream after the §25F regulations. For anyone forming an SGO now, the practical translation: set up a segregated §25F account from day one, plan for an annual audit, and expect the full rulebook before the back-to-school season ends. We've archived the full text of [the guidance preview](https://eftccredit.com/documents/treasury-25f-guidance-preview) and [the press release](https://eftccredit.com/documents/treasury-eftc-press-release-june-2026), and published [a practical walkthrough of every item in the preview](https://eftccredit.com/learn/25f-proposed-regulations-preview). Sources: - U.S. Treasury press release: Treasury Previews Education Freedom Tax Credit Guidance (June 10, 2026): https://home.treasury.gov/news/press-releases/sb0527 - Treasury: Preview of Forthcoming Section 25F Guidance, remarks by DAS Kevin Salinger (PDF): https://home.treasury.gov/system/files/136/Preview-of-Forthcoming-Guidance.pdf - Treasury / Dept. of Education: Education Freedom Tax Credit Fact Sheet (PDF): https://home.treasury.gov/wftc/fact-sheets/education-freedom-tax-credit-fact-sheet-113147.pdf Canonical: https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026 ### Maine, the state the Supreme Court ordered to fund religious schools, is sitting out §25F Date: 2026-06-09. Category: analysis. State: ME. There is no state where sitting out the federal Education Freedom Tax Credit (§25F) is more striking than Maine. In 2022, the U.S. Supreme Court ruled in Carson v. Makin that Maine could not bar religious schools from its town-tuitioning program, the arrangement under which towns too small to run their own high school pay tuition to a public or approved private school the family chooses. Maine had limited that money to "nonsectarian" schools; the Court held, 6 to 3, that excluding schools because they are religious violates the Free Exercise Clause. The practical result is that Maine already sends public dollars directly to religious schools, a more direct flow than §25F's donor-credit mechanism ever contemplates. And yet, as the federal credit moves toward its January 1, 2027 launch, Maine is not in it. When the IRS published its [official roster of 27 participating states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) on June 8, 2026, Maine was absent. The list ran from Alabama to Wyoming and included every neighbor that had moved, but not Maine, which has filed no advance election and submitted no list of qualifying Scholarship Granting Organizations (SGOs). Nor is the gap a matter of paperwork lagging a decision: Gov. Janet Mills (D) has issued no statement on §25F in either direction, neither the opt-in that a governor makes by filing IRS Form 15714 nor a formal decline of the kind [Oregon's Gov. Kotek](https://eftccredit.com/news/oregon-kotek-declines-25f-treasury-state-rule-limits-june-2026) issued. Maine simply has not engaged. The legislative door for 2026 is now shut. The 132nd Maine Legislature adjourned its Second Regular Session sine die at the end of April 2026 without taking up a §25F enabling or SGO-certification bill, so absent a special session the state cannot act through statute until 2027. That timing matters because of who will be making the call. Mills is term-limited and cannot run in November 2026, which means the governor who would actually administer a Maine opt-in for the program's first live year, 2027, will be someone elected this fall. A sitting governor with nothing to gain politically and a successor not yet chosen is a recipe for exactly the silence Maine is producing. It would be a mistake to read Maine's absence as hostility to publicly funded private schooling, because Carson makes Maine an awkward fit for the usual blue-state objections. The argument other Democratic-led states have pressed, that they want room to write their own conditions onto participating SGOs, runs into a wall in a state the Supreme Court has already told it cannot single out religious schools for worse treatment. The unresolved federalism question of whether §25F is a [federal floor or a ceiling on state add-ons](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026) is, in Maine, layered on top of a constitutional command that narrows what the state may do in the first place. Maine's posture looks less like the principled refusals of [Minnesota](https://eftccredit.com/news/minnesota-governor-walz-declines-fstc-march-2026) or the holdouts we track among [Democratic governors](https://eftccredit.com/news/democratic-governors-split-on-25f-2026) and more like a state that has chosen not to decide. For Maine donors, families, and anyone weighing whether to stand up an SGO in the state, the takeaway is plain: there is no §25F path in Maine before the 2027 launch unless Mills files an advance election on her way out or her successor moves quickly after taking office. The federal credit's mechanics are unaffected by Maine's choice: donors in participating states can give up to $1,700 to a qualified SGO and claim a dollar-for-dollar federal credit, the fixed figure we explain in [why the credit is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Maine's status, and every other state's, is tracked on our [Maine state page](https://eftccredit.com/states/maine) and the [national participation map](https://eftccredit.com/states); operators who want the infrastructure ready in case Maine ever moves can start with our [explainers](https://eftccredit.com/learn) and the [SGO directory](https://eftccredit.com/sgos). Sources: - IRS IR-2026-76: More than half the U.S. states signed up to participate in the federal Scholarship Tax Credit program (June 8, 2026), Maine not listed: https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Carson v. Makin, 596 U.S. 767 (2022), Supreme Court opinion: https://www.supremecourt.gov/opinions/21pdf/20-1088_dbfi.pdf - Maine Legislature: 132nd Legislature, Second Regular Session (adjournment / session status): https://legislature.maine.gov/ - Maine Department of Education: Tuition / town tuitioning program: https://www.maine.gov/doe/schools/tuition - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/maine-sidelined-25f-carson-v-makin-legislature-adjourns-june-2026 ### 27 states are on the IRS's official §25F roster, and four states that said yes aren't on it yet Date: 2026-06-08. Category: regulatory. The IRS announced on June 8, 2026 (IR-2026-76) that more than half the states, 27 in total, have signed up to participate in the federal Scholarship Tax Credit (FSTC / ECCA / §25F) ahead of its January 1, 2027 launch. The official roster: Alabama, Alaska, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Louisiana, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming. "It's encouraging to see that 27 states have already signed up to participate in this program," said IRS chief Frank Bisignano. The more interesting story is who isn't on the list. Kentucky and Kansas opted in by legislative veto override in March and April; North Carolina completed its override on June 3; and New York's Governor Kathy Hochul announced in May that the state plans to participate. None of the four appears on the IRS's June 8 roster. That's not a contradiction, it's the gap between a state deciding to participate and a state completing the formal advance election under Revenue Procedure 2026-6. The election is a specific filing (Form 15714, submitted by the governor or whoever state law designates to make federal tax elections for the state), and in override states the executive branch that just lost the veto fight is the one expected to process the paperwork the legislature mandated. The IRS says it will keep updating the list as states complete the election and submission process. This is why public trackers disagree with the IRS count: outlets counting enacted opt-ins put participation at roughly 30 states or more, while the IRS counts only completed elections. Both numbers are right; they measure different things. For donors and SGO founders, the IRS list is the one that ultimately matters, a donor's 2027 credit depends on contributing to an SGO that appears on a covered state's submitted SGO list, and a state becomes a covered state through the election, not the press conference. The practical read for anyone forming an SGO in one of the four gap states: the legal commitment is in place and the remaining step is administrative, but watch for your state to appear on the IRS's official participation page before relying on it, and note that in override states, follow-through has so far required sustained attention from legislators and advocates, not just the initial vote. For the 27 listed states, the next milestone is each state's submission of its qualified-SGO list, the final link that makes donations creditable when the program goes live January 1, 2027. Update, June 23, 2026: the IRS roster grew to 28 when North Carolina completed its advance election, weeks after its legislature overrode Gov. Josh Stein's veto. That leaves New York, Kansas, and Kentucky as the states that have committed by announcement or override but have not yet finished the formal IRS election. Update, July 7, 2026: [Kansas completed its advance election](https://eftccredit.com/news/kansas-completes-federal-25f-filing-irs-roster-29-july-2026), bringing the official roster to 29. Kentucky (veto override, filing pending) and New York (committed, not yet filed) are the two states still outstanding. Sources: - IRS newsroom: More than half the U.S. states signed up to participate in the federal scholarship tax credit program (IR-2026-76): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Ballotpedia: State participation in the federal K-12 education tax credit program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program - Defense of Freedom Institute: EFTC State Participation Status tracker: https://dfipolicy.org/education-freedom-tax-credit/ Canonical: https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026 ### D.C. sits out the §25F roster: a mayor's call, not a legislature's, and Bowser is on her way out Date: 2026-06-08. Category: state-action. State: DC. When the IRS published its first official roster of jurisdictions participating in the federal Scholarship Tax Credit (FSTC / §25F) on June 8, 2026, in news release IR-2026-76, the District of Columbia was not on it. The list named 27 participating jurisdictions, all of them states: Alabama, Alaska, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Louisiana, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming. The §25F credit lets a taxpayer claim a one-for-one federal credit of up to $1,700 for donations to qualified Scholarship Granting Organizations, and it becomes available January 1, 2027. D.C.'s absence from the [27-jurisdiction roster](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) means residents of the nation's capital will not have access to the credit when the program launches unless that changes. The mechanism here is what makes the District distinctive. Revenue Procedure 2026-6 explicitly names D.C. as eligible to participate, referring to the jurisdictions "including the District of Columbia, to make an Advance Election." The election is made on Form 15714, "Advance Election to Participate Under Section 25F for 2027." For the 50 states, that election is the governor's to make. The District has no governor, so under §25F(g)(2) the authority falls to the Mayor in lieu of a governor, exercised as an executive Advance Election rather than through a separate statute. The District does have a legislature in the D.C. Council, but the participation decision does not run through it: per the IRS guidance and analysis of Rev. Proc. 2026-6 by Current Federal Tax Developments, this is the mayor's call. To date, Mayor Muriel Bowser has filed no advance election. Timing complicates the picture. Bowser announced on November 25, 2025, that she will not seek re-election, and the next D.C. mayoral election is set for November 3, 2026. That leaves the §25F decision in limbo: a lame-duck mayor who has shown no inclination to opt in, and a successor who will not take office until after the program has already launched. The dynamic resembles the lame-duck inheritance seen elsewhere, such as Virginia, where [Glenn Youngkin opted in before handing the program to his successor](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), except that in the District no election has been made at all. The contrast with the states that moved early, like [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026) and [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), is stark: each had a sitting executive willing to sign on, and the District has neither acted nor signaled it intends to. For donors and prospective SGO founders, the practical consequence is straightforward. Without an advance election on file, no §25F credit flows to D.C. taxpayers and no qualified Scholarship Granting Organization can receive credit-eligible donations in the District for the 2027 launch. That does not mean the door is closed permanently, because a future mayor could file the election in a later cycle, but it does mean the capital starts behind the 27 states already on the roster. Operators eyeing the District should track whether any 2026 mayoral candidate adopts a §25F position, since the decision is now effectively a campaign question. How the credit works for families and the organizations that administer it is laid out in our [explainers](https://eftccredit.com/learn), and the current national landscape is detailed alongside every jurisdiction's status on the [District of Columbia page](https://eftccredit.com/states/district-of-columbia) and the [national participation map](https://eftccredit.com/states). The forward question is whether §25F becomes a live issue in the 2026 D.C. mayoral race. With Bowser stepping aside and the program launching just weeks after the new mayor is sworn in, the next executive will face an early, concrete choice: file the Form 15714 advance election and stand up an SGO framework, or leave the District out while neighboring states route credit-eligible donations to scholarships. SGO operators who do want to be ready can run a program on software built for §25F from day one, and founders can review how the organizations function in our [explainers](https://eftccredit.com/learn) and scan the existing [SGO directory](https://eftccredit.com/sgos). For now, the District remains the conspicuous blank on a map where more than half the states have already said yes. Sources: - IRS IR-2026-76: more than half the U.S. states signed up for the federal scholarship tax credit (27-jurisdiction roster, DC absent): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - IRS: Treasury, IRS allow states to make an advance election under §25F (names DC eligible, $1,700, Form 15714, Jan. 1 2027): https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill - Current Federal Tax Developments: IRS guidelines for §25F advance elections (Rev. Proc. 2026-6; Mayor makes the DC election under 25F(g)(2)): https://www.currentfederaltaxdevelopments.com/blog/2025/12/12/irs-guidelines-for-section-25f-advance-elections-revenue-procedure-2026-6 - Bloomberg: Washington D.C. Mayor Muriel Bowser won't seek re-election in 2026 (Nov. 25, 2025): https://www.bloomberg.com/news/articles/2025-11-25/washington-dc-mayor-muriel-bowser-won-t-seek-re-election-in-2026 - The Hill: DC Mayor Bowser won't seek re-election in 2026: https://thehill.com/homenews/campaign/5622245-dc-mayor-bowser-not-running/ Canonical: https://eftccredit.com/news/district-of-columbia-absent-from-25f-roster-bowser-mayors-call-june-2026 ### Wyoming Joins the Federal §25F Scholarship Tax Credit, Moving Gov. Gordon From 2025 'Review' to Participation Date: 2026-06-08. Category: state-action. State: WY. Wyoming has joined the federal Education Freedom Tax Credit (§25F). On June 8, 2026, the IRS released IR-2026-76, which lists Wyoming among 27 states participating in the federal Scholarship Tax Credit program enacted under the One Big Beautiful Bill. Per that release, taxpayers may claim a federal tax credit of up to $1,700 for contributions to Scholarship Granting Organizations (SGOs). Wyoming had already been counted among the advance-notice states by April 15, 2026, when K-12 Dive reported that 27 states had signaled participation and named Wyoming explicitly. The state's appearance on the official roster confirms that Wyoming submitted its advance election to the IRS, putting it inside the group of states whose residents will have an in-state §25F program when the credit goes live January 1, 2027. The outcome closes a notable gap. In August 2025, Gov. Mark Gordon, a Republican, was publicly noncommittal: in Wyoming Public Media reporting dated August 12, 2025, his spokesperson Michael Pearlman said the office was "currently reviewing the school choice provision" and that the governor wanted a "plan that best fits Wyoming." That posture was a review, not a refusal, and the move from review to participation tracks the broader trajectory of red and purple states this year. Wyoming was not among the earliest filers profiled when the first wave of states elected in around January 2026 (it first surfaces on the public count in mid-April), so its arrival on the June roster represents the deliberate, later end of that process rather than a day-one commitment like the ones we covered in [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026) or [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026). The mechanics are the same in every participating state. A state opts in when its governor files an advance election with the IRS and designates qualifying SGOs. Donors anywhere in the country can then claim a dollar-for-dollar federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO, which awards K-12 scholarships to families earning up to 300% of their area median gross income. The cap is $1,700 per taxpayer, a point worth underlining because of recurring confusion over whether married couples get double; for the statutory detail, see our explainer on why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). The credit takes effect January 1, 2027, and a state that files an election gives its residents both an in-state place to give and an in-state pathway for families to receive scholarships. For donors, families, and prospective SGO founders in Wyoming, the practical takeaway is that the state is now in. Wyoming taxpayers will be able to route §25F-eligible donations to in-state SGOs once the program is operational, and Wyoming families will be eligible to receive the scholarships those organizations fund. Because Wyoming is a comparatively small market with a still-thin school-choice infrastructure, the first organizations to stand up scholarship programs will define how the credit reaches families across the state. Operators weighing whether to launch one of Wyoming's first SGOs can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current national landscape in the [SGO directory](https://eftccredit.com/sgos); the back-office work of donor intake, eligibility checks, and scholarship disbursement can be run on software built specifically for §25F. Wyoming's status, and every other state's, is tracked on our [Wyoming state page](https://eftccredit.com/states/wyoming) and the [national participation map](https://eftccredit.com/states). The forward question is how quickly Wyoming designates and stands up qualifying SGOs before the January 1, 2027 launch, since an election on the federal roster is only the first step. The IRS's 27-state count, detailed in our coverage of the [official June 2026 participation list](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026), marks the program crossing the halfway point of states, and Wyoming's late but firm entry suggests the "wait and see" camp is thinning. With the credit now confirmed for Wyoming, the measure of success shifts from whether the state opts in to how many in-state organizations are ready to receive donations on day one. Sources: - IRS IR-2026-76: More than half the US states signed up to participate in the federal Scholarship Tax Credit program (Wyoming listed among 27 states), June 8, 2026: https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Wyoming Public Media: Gordon weighs joining federal school choice program (Aug 12, 2025): https://www.wyomingpublicmedia.org/education/2025-08-12/gordon-weighs-joining-federal-school-voucher-program - K-12 Dive: 27 states opting into federal school choice program, Wyoming among advance-notice states (Apr 22, 2026): https://www.k12dive.com/news/27-states-opting-into-federal-school-choice-program-IRS-Congress/818087/ - Ballotpedia: Mark Gordon (Wyoming) profile: https://ballotpedia.org/Mark_Gordon_(Wyoming) Canonical: https://eftccredit.com/news/wyoming-gordon-opts-in-25f-from-review-to-participation-june-2026 ### After the override, NC's Stein pivots: a Democratic governor's plan to steer §25F donations to public-school students Date: 2026-06-05. Category: state-action. State: NC. When the North Carolina Senate completed its override of Governor Josh Stein's veto on June 3, 2026, the state joined the federal Scholarship Tax Credit (FSTC / ECCA / §25F) over its governor's objection, the third state to arrive by the [veto-override route](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026) after Kentucky and Kansas. What happened next is the more instructive story. Rather than treating the loss as the end of the fight, Stein pivoted the same day from opponent to reluctant participant, and pointed to a path most coverage of §25F has overlooked: using the credit to benefit public-school students. "I see potential opportunities for public school students to benefit from this program," Stein said, adding that his administration is "working on a solution to make it easy for North Carolinians like me who want to direct their federally reimbursed donations to scholarship-granting organizations that directly benefit public school students." It is a notable reframing from a governor who had argued the credit would drain public education. The substance behind it is real: §25F scholarships are tied to the Section 530 list of qualified education expenses, which reaches well beyond private tuition to tutoring, special-needs services, technology, and other support that public-school families use, so an SGO can be built to serve students who never leave their district school. Stein's move did not go unnoticed nationally. By late June, coverage was grouping him with New York's Kathy Hochul as Democratic governors choosing to work within the program rather than refuse it outright, even as the teachers' unions escalated their campaign urging Democratic governors to [reject it entirely](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026). That tension, a forced opt-in that a Democratic governor then tries to shape constructively, is precisely the split we have tracked among [Democratic governors on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026), and North Carolina now sits at its leading edge. For donors, families, and prospective Scholarship Granting Organization founders, Stein's stance is a signal worth reading carefully. It validates a model that opponents and supporters alike often miss: a public-school-serving SGO, organized to channel §25F-credited donations into the Section 530 expenses of public-school students, is permitted by the statute and now has a sitting governor actively encouraging it. For operators, that is an opening, not a threat, and one that could blunt the "vouchers only help private schools" objection in exactly the divided states where it is loudest. The mechanics do not change: donors in a participating state can give up to $1,700 to a qualified SGO and claim a dollar-for-dollar federal credit when the program launches January 1, 2027. North Carolina's status, and every other state's, is tracked on our [North Carolina state page](https://eftccredit.com/states/north-carolina) and the [national participation map](https://eftccredit.com/states); founders weighing where and how to organize can start with our [explainers](https://eftccredit.com/learn) and the [national SGO directory](https://eftccredit.com/sgos). Sources: - EdNC: NC enrolled in federal school choice tax credit following veto override (June 5, 2026): https://www.ednc.org/6-5-2026-nc-enrolled-in-federal-school-choice-tax-credit-following-veto-override-and-other-legislative-news/ - Ballotpedia News: North Carolina General Assembly overrides governor's veto of §25F opt-in bill (June 12, 2026): https://news.ballotpedia.org/2026/06/12/north-carolina-general-assembly-overrides-governors-veto-of-bill-opting-state-into-federal-education-tax-credit-scholarship-program/ - The Washington Times: Teachers unions attack Democratic governors who embrace Trump's school tax credit (June 24, 2026): https://www.washingtontimes.com/news/2026/jun/24/teachers-unions-attack-democratic-governors-embrace-trumps-school/ Canonical: https://eftccredit.com/news/north-carolina-stein-public-school-sgo-pivot-25f-june-2026 ### Still pending: what Treasury's §25F proposed regulations need to resolve before 2027 Date: 2026-06-04. Category: regulatory. Update, June 10, 2026: Treasury has now previewed the proposed regulations and committed to issuing them by the end of September. Several of the open questions below, the 90% "income" definition, the multistate question, and the "located in" standard, have preliminary answers. See our coverage: [Treasury previews the §25F proposed regulations](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026). The federal Scholarship Tax Credit (FSTC / ECCA / §25F) is moving on two tracks that haven't fully met. On one track, states are signing up: Treasury and the IRS released Revenue Procedure 2026-6 and Form 15714 on December 12, 2025, giving states the exclusive process to make an "advance election" to become a covered state for 2027. On the other track, the substantive rules that will govern how donors and Scholarship Granting Organizations actually operate are still in progress. The IRS issued Notice 2025-70 on November 25, 2025 requesting public comment, the comment window closed December 26, 2025, and Treasury has said it intends to issue proposed regulations, but as of June 2026 those proposed regulations have not been published. Several of the open questions directly affect how SGOs must run. The statute requires an SGO to spend at least 90% of its "income" on scholarships, but "income" is not defined, whether it includes investment returns, prior-year carryover, or only current-year contributions is left to guidance. For SGOs operating in more than one state, it is not yet settled whether the 90% test is applied per-state or in the aggregate, nor exactly what it means for scholarship recipients or an SGO to be "located in" a state. These are not academic points: they shape an SGO's chart of accounts and compliance reporting from day one. Other open items affect donors and families. Treasury has not issued final guidance confirming the joint-filer treatment of the $1,700 cap (the prevailing reading is a single $1,700 per return, not $3,400 for a couple, but it isn't formally settled). Donor substantiation and recordkeeping mechanics, coordination with the Alternative Minimum Tax, and the precise method SGOs must use to verify a household's income against the 300%-of-Area-Median-Gross-Income ceiling, measured on the prior calendar year, all await the proposed regulations. For the 2027 startup year, §25F also tells states to submit their qualifying-SGO list "as early as practicable" rather than by a fixed January 1 date, and the deadline mechanics will be set in future guidance. The practical posture for anyone acting now, a state weighing its election, an organization standing up as an SGO, or a donor planning 2027 contributions, is to build to the statute and the existing notices while treating the open questions conservatively, and to watch for the proposed regulations as the single most consequential development still ahead before the January 1, 2027 launch. When the proposed rule publishes in the Federal Register, it will open another comment period and is likely to resolve most of the items above at once. Sources: - IRS Notice 2025-70 (PDF): https://www.irs.gov/pub/irs-drop/n-25-70.pdf - IRS Revenue Procedure 2026-6 (PDF): https://www.irs.gov/pub/irs-drop/rp-26-06.pdf - IRS newsroom: Treasury, IRS allow States to make an Advance Election under §25F: https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill - Current Federal Tax Developments: A Technical Analysis of §25F Guidance: https://www.currentfederaltaxdevelopments.com/blog/2025/11/25/a-technical-analysis-of-25f-guidance-the-obbba-scholarship-tax-credit Canonical: https://eftccredit.com/news/what-25f-proposed-regulations-must-resolve-2026 ### Not a party-line story: where Democratic governors landed on §25F Date: 2026-06-04. Category: analysis. State: NY. Coverage of the federal Scholarship Tax Credit (FSTC / ECCA / §25F) often reads as a red-state story, and the participation map skews that way. But the more revealing detail in 2026 is how differently Democratic governors have treated the program, because the credit is voluntarily donor-funded rather than a state appropriation, which scrambles the usual school-choice battle lines. Two Democratic governors have leaned in. Colorado's Jared Polis was among the earliest to commit, opting in on December 5, 2025 and calling the federal credit a "no-brainer" he would "be crazy not to" take for Colorado families. New York's Kathy Hochul went further than most blue-state governors when she signaled in her FY2027 budget materials in May 2026 that she intends to opt New York in, though she conditioned final participation on reviewing the forthcoming IRS guidance, so New York is best described as committed rather than certified. Other Democratic governors have drawn the opposite conclusion. Minnesota's Tim Walz said opting in was "never going to happen," pairing his opposition with a budget proposal that would have ended longstanding state nonpublic-pupil aid if the state participated. Oregon's Tina Kotek declined in 2025, and New Mexico's Michelle Lujan Grisham declined in January 2026. Hawaii's Josh Green declined to make the state's 2027 advance election, prompting [four legislative resolutions urging him to reconsider](https://eftccredit.com/news/hawaii-legislature-urges-green-reconsider-25f-march-2026), and [Maine's Janet Mills has stayed silent](https://eftccredit.com/news/maine-sidelined-25f-carson-v-makin-legislature-adjourns-june-2026) even though the Supreme Court has already required Maine to fund religious schools through its tuition program. The dividing line among these governors is less about party than about how each weighs the trade-off the program presents: federal scholarship dollars for resident families on one side, and concerns about the effect on public-school funding and federal revenue on the other. For donors and SGOs, the lesson is to read each state on its own facts rather than by the governor's party. A donor's ability to support an SGO in a given state, and a family's eligibility for scholarships, depends on whether that specific state has opted in, by whichever route, ahead of the January 1, 2027 launch. As of June 2026, roughly 30 states are participating or have signaled intent, and the blue-state column is not empty. A newer wrinkle is the governor who opposed the credit, lost, and then chose to work within it: North Carolina's Josh Stein, after his veto was overridden, [moved to steer §25F donations toward public-school students](https://eftccredit.com/news/north-carolina-stein-public-school-sgo-pivot-25f-june-2026). Sources: - Ballotpedia News: New York governor says state plans to participate in federal education tax credit scholarship program: https://news.ballotpedia.org/2026/05/19/new-york-governor-says-state-plans-to-participate-in-federal-education-tax-credit-scholarship-program/ - Ballotpedia: State participation in the federal K-12 education tax credit program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program - Defense of Freedom Institute: EFTC State Participation Status tracker: https://dfipolicy.org/education-freedom-tax-credit/ Canonical: https://eftccredit.com/news/democratic-governors-split-on-25f-2026 ### Three governors vetoed, three legislatures overrode: the veto path into §25F Date: 2026-06-04. Category: analysis. When North Carolina's Senate completed its override of Governor Josh Stein's veto on June 3, 2026, it did more than add one state to the federal Scholarship Tax Credit (FSTC / ECCA / §25F) roster. It confirmed a pattern: in three states now, a Republican-controlled legislature has forced participation in the program over a Democratic governor's objection. [Kentucky was first, overriding Governor Andy Beshear's veto of House Bill 1](https://eftccredit.com/news/kentucky-sgo-registry-secretary-of-state-adams-hb1-march-2026) on March 17, 2026. Kansas followed, overriding Governor Laura Kelly's veto of Senate Bill 361 in the April 2026 veto session, the House voting 85-38 and the Senate 29-10. North Carolina's override of HB 87 makes three. The override path matters because of how §25F is structured. Most participating states have joined through a gubernatorial "advance election", the governor files Form 15714 with the IRS to make the state a covered state for 2027. But §25F does not require the decision to come from the governor's office; a state can also opt in through legislation. When a governor vetoes that legislation and the legislature overrides the veto, the state participates with no further action required from the governor. In all three override states, the bill is now law and the SGO designation process proceeds regardless of the governor's stated preference. The three vetoes shared a common rationale. Beshear, Kelly, and Stein each argued the credit would divert resources from public education and each preferred to wait for the U.S. Treasury Department to finalize the program's rules before committing. Supporters in each state countered that §25F is voluntarily donor-funded rather than a direct appropriation, and that scholarships reach students across public, charter, private, and home-school settings. In each case the legislature had the supermajority needed to override. For families and prospective Scholarship Granting Organizations, the practical takeaway is that a sitting governor's opposition is not the last word in a state with a determined legislative majority. Kentucky, Kansas, and North Carolina families will all be eligible for scholarships when the program launches January 1, 2027, on the same terms as families in states whose governors opted in voluntarily: K-12 students in households at or below 300% of the relevant Area Median Gross Income, funded by donors who can claim a non-refundable federal credit of up to $1,700 per taxpayer. It also signals to advocates in other divided-government states that the override route is viable where the votes exist. And losing the veto is not the end of a governor's influence: in North Carolina, Stein [pivoted after the override](https://eftccredit.com/news/north-carolina-stein-public-school-sgo-pivot-25f-june-2026) to steer the credit toward public-school students rather than fight it further. Sources: - Ballotpedia: State participation in the federal K-12 education tax credit program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program - Defense of Freedom Institute: EFTC State Participation Status tracker: https://dfipolicy.org/education-freedom-tax-credit/ - Carolina Journal: Senate completes veto override, opts NC into federal school-choice tax credit: https://www.carolinajournal.com/senate-completes-veto-override-opts-nc-into-federal-school-choice-tax-credit/ Canonical: https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026 ### North Carolina Senate completes veto override, NC opts into the federal Scholarship Tax Credit Date: 2026-06-03. Category: state-action. State: NC. On June 3, 2026, the [North Carolina](https://eftccredit.com/states/north-carolina) Senate voted 30-19 to override Governor Josh Stein's veto of House Bill 87, completing a two-chamber override that began when the House voted 73-46 on May 20. The Senate vote fell strictly along party lines, with all Republicans in favor and all Democrats opposed. With the override complete, HB 87 becomes law over the governor's objection and North Carolina is now opted into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. Because the program was enacted by legislative override rather than gubernatorial election, North Carolina's participation does not depend on any further action by Governor Stein. The state will designate qualifying [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide), and North Carolina families become eligible for scholarships when the federal program goes live on January 1, 2027. Under §25F, scholarships go to K-12 students in households at or below 300% of the relevant Area Median Gross Income, and donors anywhere in the country can claim a non-refundable federal income tax credit of up to $1,700 per taxpayer for cash contributions to a qualifying SGO. North Carolina becomes the third state to join the program through a veto override, following Kentucky (House Bill 1, override completed March 17, 2026) and Kansas (Senate Bill 361, overridden in the April 2026 veto session). In each case a Republican-controlled legislature forced participation against a Democratic governor's veto. Senate Republicans noted the vote was the latest in a long run of successful overrides of Governor Stein this session. Stein had vetoed HB 87 citing concerns that the federal credit would reduce tax revenue available for public education and a preference to wait for final U.S. Treasury rules before committing. Supporters countered that the program is voluntarily donor-funded and reaches students across public, charter, private, and home-school settings. The override adds North Carolina to a roster of roughly 30 participating states ahead of the 2027 launch, even as Treasury's proposed regulations implementing §25F remain pending. Sources: - WRAL: NC lawmakers enact education tax-break bill, override Stein veto (June 3): https://www.wral.com/news/nccapitol/north-carolina-trump-education-tax-break-policy-veto-override-june-3/ - NC Newsline: Senate overrides Stein veto to enact scholarship tax credit bill: https://ncnewsline.com/briefs/north-carolina-senate-overrides-ninth-stein-veto-to-enact-scholarship-tax-credit-bill/ - Carolina Journal: Senate completes veto override, opts NC into federal school-choice tax credit: https://www.carolinajournal.com/senate-completes-veto-override-opts-nc-into-federal-school-choice-tax-credit/ Canonical: https://eftccredit.com/news/north-carolina-senate-completes-stein-veto-override-june-2026 ### Illinois ends its spring session without acting on §25F, leaving every opt-in bill dead in committee and the decision to Pritzker Date: 2026-06-01. Category: state-action. State: IL. The Illinois General Assembly adjourned its 2026 spring session in the early hours of June 1, 2026, running past its scheduled May 31 deadline, without taking any action on the federal Scholarship Tax Credit (FSTC / ECCA / §25F), the donor-funded K-12 scholarship credit that launches January 1, 2027 with a per-donor credit cap of $1,700. Three separate bills had been introduced to opt the state in, and not one of them received a committee vote or a floor vote before lawmakers went home. The legislature did not affirmatively vote the program down. It simply let all three measures die in committee without a hearing on their merits, which leaves Illinois in a distinct posture among the states still weighing participation. The two Senate measures never left the chamber's gatekeeping committee. SB3776, filed by Sen. Adriane Johnson (D-Buffalo Grove) on February 5, 2026 under the "Educational Choice for Children Act" banner and written to require compliance with the federal credit for tax years after December 31, 2026, was referred to the Senate Assignments Committee and stayed there through adjournment; co-sponsors were still being added as late as the May 19 to 20 window, but the bill never moved. SB3850, filed by Sen. John F. Curran (R-Downers Grove) on February 6 and drafted to direct the Governor to submit a list of Scholarship Granting Organizations to the U.S. Treasury, met the same fate in Senate Assignments. On the House side, HB4099 from Rep. Tony McCombie (R), which referenced the federal One Big Beautiful Bill Act and Section 25F, was first read and referred to the House Rules Committee on October 15, 2025 and never advanced from there. With no enabling legislation enacted, the practical question of whether Illinois participates in 2027 now rests with Gov. JB Pritzker rather than the legislature. §25F is structured so that a state's participation flows from the governor submitting a list of approved Scholarship Granting Organizations to Treasury; in the absence of a statute compelling or barring that step, a governor can elect into the program administratively. Treasury's published mechanism for a state to signal participation ahead of the launch year is an executive Advance Election (IRS Form 15714), so a Pritzker-led opt-in for 2027 would most plausibly run through that route. That framing is our reading of how the federal structure interacts with Illinois's now-stalled legislative track, not a step the Governor has announced; as of adjournment he had not committed either way, and Illinois remains listed as undecided on our [Illinois state page](https://eftccredit.com/states/illinois) and the [participation map](https://eftccredit.com/states). The June 1 outcome moves Illinois past the op-ed and advocacy phase we covered when [the public debate intensified in May](https://eftccredit.com/news/illinois-public-debate-intensifies-pritzker-may-2026) and into a concrete legislative result: a Democratic-trifecta state where lawmakers declined to take up the question at all, deferring entirely to the executive. That distinguishes Illinois both from the divided states that have used a [veto-override path into §25F](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026) and from the states where a governor has moved first. It also leaves the door open in either direction, since nothing the legislature did forecloses a future administrative election or a fresh bill in a later session. Prospective donors, families, and Scholarship Granting Organization founders watching Illinois can track the mechanics of the program on our [learn pages](https://eftccredit.com/learn) and find participating-state organizations in the [SGO directory](https://eftccredit.com/sgos); for now, the Illinois decision belongs to the Governor's office, which has said it is still reviewing the program as it awaits the federal regulations expected later in 2026. Sources: - Illinois General Assembly: Bill Status of SB3776 (Sen. Adriane Johnson; action history showing referral to Senate Assignments Committee): https://my.ilga.gov/Legislation/BillStatus?DocNum=3776&GAID=18&DocTypeID=SB&LegId=167091&SessionID=114 - Illinois General Assembly: Bill Status of SB3850 (Sen. John F. Curran; remained in Senate Assignments Committee): https://my.ilga.gov/Legislation/BillStatus?DocNum=3850&GAID=18&DocTypeID=SB&SessionID=114 - Illinois General Assembly: Bill Status of HB4099 (Rep. Tony McCombie; referred to House Rules Committee Oct. 15, 2025): https://ilga.gov/Legislation/BillStatus?DocNum=4099&GAID=18&DocTypeID=HB&LegId=164052&SessionID=114 - STLPR: Breaking down the $56B Illinois budget and other bills from the 2026 spring legislative session (June 2, 2026): https://www.stlpr.org/government-politics-issues/2026-06-02/breaking-down-illinois-budget-other-bills-2026-spring-legislative-session Canonical: https://eftccredit.com/news/illinois-spring-session-adjourns-25f-bills-die-committee-june-2026 ### $1,700, not $3,400: what the §25F statute already settles about the credit Date: 2026-05-29. Category: regulatory. With more than 30 states moving to participate in the federal Scholarship Tax Credit (FSTC / ECCA / §25F) and the program's January 1, 2027 launch approaching, a few donor-level details are drawing scrutiny, and one common assumption appears to be wrong. The §25F statute (and the early reading from tax practitioners) already settles more than the "await guidance" framing suggests. The cap is $1,700 per return, not $3,400 for a couple. §25F(b)(1) limits the credit "to any taxpayer for any taxable year" to $1,700, and the statute contains no provision doubling that amount for a joint return (there is no "200 percent" or "twice" language of the sort Congress uses elsewhere when it wants to double a married-filing-jointly figure). The prevailing expert reading, reflected, for example, in Brownstein's April 2026 §25F Q&A, is that a married couple filing jointly receives a single $1,700 credit, not $3,400. Two single filers each have their own $1,700 cap on their own returns. Treasury has not issued final guidance on joint-filer treatment, so donors should plan conservatively at $1,700 per return until it does. You can't double-dip, and you can't stack the federal credit on a state credit for the same dollars. Two statutory rules govern this. Under §25F(e), a contribution for which the §25F credit is claimed cannot also be taken as a charitable deduction under §170, no credit-plus-deduction on the same gift. And under §25F(b)(2), the federal credit is reduced by the amount of any state tax credit the donor claims for the same qualified contributions. That means donors in states with their own scholarship tax-credit programs cannot claim both the federal and the state credit on a single donation; making separate donations to separate organizations is the way to access both benefits. What's still genuinely open is narrower than it's sometimes portrayed. The biggest unresolved questions for the forthcoming Treasury proposed regulations involve the [Scholarship Granting Organization (SGO)](https://eftccredit.com/learn/sgo-guide) [90% spending test](https://eftccredit.com/learn/sgo-90-10-rule-compliance), the statute requires an SGO to spend at least 90% of its income on scholarships, but "income" is not defined and is expected to be addressed in guidance, along with donor substantiation and recordkeeping mechanics and coordination with the Alternative Minimum Tax. Treasury and the IRS received more than 2,200 comments in response to Notice 2025-70 (the comment window closed December 26, 2025) and are expected to issue proposed regulations during 2026 ahead of the launch. The practical takeaway for donors: budget around a $1,700-per-return federal credit, don't assume $3,400 for joint filers, and treat the federal credit and any state scholarship credit as applying to separate donations rather than the same dollars. Sources: - Cornell LII: 26 U.S.C. §25F (see subsections (b) and (e)): https://www.law.cornell.edu/uscode/text/26/25F - Brownstein: Federal Scholarship Tax Credit, Q&A Guide: https://www.bhfs.com/insight/federal-scholarship-tax-credit-qa-guide/ - Current Federal Tax Developments: A Technical Analysis of §25F Guidance: https://www.currentfederaltaxdevelopments.com/blog/2025/11/25/a-technical-analysis-of-25f-guidance-the-obbba-scholarship-tax-credit - IRS Notice 2025-70 (PDF): https://www.irs.gov/pub/irs-drop/n-25-70.pdf - Afterschool Alliance: Treasury and IRS reviewing public comments on the Federal Tax Credit Scholarship: https://www.afterschoolalliance.org/afterschoolsnack/Treasury-and-IRS-reviewing-public-comments-on-the-Federal-Tax_01-16-2026.cfm Canonical: https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026 ### Illinois Senate Republicans press for a §25F opt-in in the session's final week: 'We will be left out and left behind' Date: 2026-05-22. Category: state-action. State: IL. With the 2026 spring session winding down, Illinois Senate Republicans made a public push to advance two bipartisan bills that would opt the state into the federal Scholarship Tax Credit (FSTC / ECCA / §25F), the new program that lets donors claim a credit of up to $1,700 for gifts to scholarship granting organizations and that launches January 1, 2027. The vehicles are SB3776, whose chief sponsor is Democratic Sen. Adriane Johnson, and SB3850, sponsored by Senate Republican Leader John Curran of Downers Grove. Both were referred to the Senate Assignments Committee in February and, as of the GOP push in the week of May 18, both remained parked there without having been called for a hearing. The federal credit requires a state to affirmatively opt in before its residents can participate, which is why the calendar, and the committee, matter so much. The Republican strategy in the final week was to build visible momentum through co-sponsors. Senate records show Curran signed on as a co-sponsor of Johnson's SB3776 on May 18, 2026, and Sen. Li Arellano Jr. was added the following day, part of a flurry of GOP names attached to both measures between May 18 and May 20. The cross-party signal cut both ways: on the Democratic side, only Johnson and Sen. David Koehler (added as a co-sponsor of SB3776 on March 3) had publicly backed the opt-in, leaving the bipartisan bill short of the broad majority-caucus support it would need to move. Curran framed the stakes as competitive and time-sensitive, telling colleagues that "time is of the essence" ahead of the January 1, 2027 deadline. Donors, he warned, "are going to go to other states if Illinois does not opt in. We will be left out and left behind." Republicans also made an economic case. Sen. Jil Tracy of Quincy called the credit a "no-brainer," arguing it could unlock roughly $1 billion in donor-funded scholarships for Illinois students at no direct cost to the state treasury, since the dollars come from private contributions rather than appropriations. Sen. Dave Syverson of Cherry Valley joined the chorus pressing leadership to call the bills. The pitch leaned on the structure of the program: because §25F scholarships are funded by donors who receive the federal credit, supporters argue a state can extend a new education benefit to families simply by adding its scholarship organizations to the federal list, without cutting a check from its own budget. That framing is exactly what makes the opt-in decision politically charged in a state where the teachers' unions and many Democratic legislators view the credit as a federal voucher in disguise. Despite the late push, neither SB3776 nor SB3850 was advanced out of Assignments before the chamber's attention moved on, and both remained stuck in committee as the GOP effort played out. For Illinois families, donors, and prospective scholarship organization founders, the practical takeaway is that the state had not opted in as of this reporting, which means the federal credit will not be available to Illinois residents at launch unless the legislature acts in a future session or special session. We track Illinois' status, and every other state's, on our [Illinois state page](https://eftccredit.com/states/illinois) and the broader [state participation map](https://eftccredit.com/states). Operators weighing whether to stand up a scholarship granting organization can review how the program works in our [explainers](https://eftccredit.com/learn) and find existing organizations in our [SGO directory](https://eftccredit.com/sgos). Sources: - Capitol News Illinois via NPR Illinois: 'We will be left out and left behind': Senate GOP urges action on school choice bills (May 22, 2026): https://www.nprillinois.org/news/2026-05-22/we-will-be-left-out-and-left-behind-senate-gop-urges-action-on-school-choice-bills - Capitol News Illinois: 'We will be left out and left behind': Senate GOP urges action on school choice bills: https://capitolnewsillinois.com/news/we-will-be-left-out-and-left-behind-senate-gop-urges-action-on-school-choice-bills/ - Illinois General Assembly: SB3776 action history (co-sponsor additions May 18-19, 2026; referred to Assignments Feb. 5, 2026): https://my.ilga.gov/Legislation/BillStatus?DocNum=3776&GAID=18&DocTypeID=SB&LegId=167091&SessionID=114 Canonical: https://eftccredit.com/news/illinois-senate-gop-25f-opt-in-push-may-2026 ### Iowa tuition organizations form the Iowa Scholarship Granting Organization for §25F, pitching in-state administration Date: 2026-05-21. Category: state-action. State: IA. On May 21, 2026, the Iowa Alliance for Choice in Education (Iowa ACE) published an announcement, authored by Shane Vander Hart, that a group of existing Iowa School Tuition Organizations (STOs) are working together to create the Iowa Scholarship Granting Organization (ISGO). The new entity is already incorporated and is designed to partner with existing Iowa STOs to administer the federal scholarship tax credit program, the 100% federal credit of up to $1,700 for contributions to a qualified Scholarship Granting Organization that launches January 1, 2027. Iowa ACE lists ISGO contacts as Trish Wilger (twilger@iowaace.org) and Josh Bowar (josh@iowachristianschools.org). The move follows [Iowa's opt-in](https://eftccredit.com/states/iowa): Republican Gov. Kim Reynolds announced her plan to opt into the federal program on January 5, 2026, an advance election that clears the way for Iowa donors to begin claiming the credit once the program opens. The pitch is explicitly local. Iowa ACE frames ISGO against the "national organizations that are already seeking SGO business in Iowa," arguing that a homegrown coalition keeps money where the donations originate. "Rather than directing administrative fees out of state, the goal is to keep resources focused on Iowa schools, Iowa families, and Iowa students," the announcement reads. That positioning matters because §25F lets any qualifying nonprofit operate as a Scholarship Granting Organization, which means out-of-state incumbents and in-state coalitions alike can compete for the same donor relationships and the same families. ISGO's answer is to bundle Iowa's existing STO infrastructure (organizations that have administered the state's tuition tax credit for years) into a single federal-facing vehicle rather than ceding the federal channel to a national operator. For donors, the mechanism tracks the federal statute. A contribution to a qualified SGO yields a dollar-for-dollar federal tax credit of up to $1,700, a figure the statute already settles even as the joint-filer treatment remains contested, which we cover in [our breakdown of the $1,700 cap](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). For the STOs behind ISGO, the calculus is operational: pooling into one incorporated SGO lets them share compliance, donor reporting, and scholarship-disbursement plumbing instead of each rebuilding it alone. Operators weighing that same build-versus-partner question, in Iowa or anywhere, can run a §25F program on software purpose-built for the credit, and our [directory of scholarship-granting organizations](https://eftccredit.com/sgos) and [explainers](https://eftccredit.com/learn) track who is standing up programs in each state. ISGO is a private nonprofit coalition initiative downstream of the state opt-in, not a government action, and the announcement does not claim it is Iowa's first or only federal SGO. The framing is the opposite: it concedes that national organizations are already courting Iowa, and positions ISGO as the in-state alternative. (Secondary reporting from Ballotpedia has described Iowa as roughly the sixth state to indicate participation, a ranking that comes from that coverage rather than the primary sources here.) The contrast with the incumbent-driven approach elsewhere is instructive, much as [Step Up For Students built a dedicated federal vehicle in Florida](https://eftccredit.com/news/step-up-for-students-launches-dedicated-25f-sgo-florida-january-2026): in Iowa, the play is consolidation among established STOs rather than a single dominant operator. What to watch next is whether ISGO's in-state coalition model holds against the national SGOs already pursuing Iowa donors, and how many of Iowa's STOs ultimately route their federal activity through it before the January 1, 2027 launch. With Iowa's advance election on the books, the competition now shifts from whether the state participates to who administers the dollars. We track Iowa's status and participating organizations on the [Iowa state page](https://eftccredit.com/states/iowa), follow the national rollout on the [participation map](https://eftccredit.com/states), and maintain the [running list of states that have made the advance election](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) as more SGOs incorporate ahead of the launch. Sources: - Iowa Alliance for Choice in Education: Announcing Iowa's Scholarship Granting Organization (May 21, 2026, Shane Vander Hart): https://www.iowaace.org/iowa-scholarship-granting-organization/ - Gov. Kim Reynolds press release: opts into federal education tax credit program (Jan. 5, 2026): https://governor.iowa.gov/press-release/2026-01-05/gov-reynolds-opts-federal-education-tax-credit-program-expands-school-choice-iowa-families - Ballotpedia News: Iowa indicates participation in federal school choice tax credit program (Jan. 8, 2026): https://news.ballotpedia.org/2026/01/08/iowa-indicates-participation-in-federal-school-choice-tax-credit-program/ Canonical: https://eftccredit.com/news/iowa-stos-form-iowa-scholarship-granting-organization-isgo-may-2026 ### North Carolina House overrides Gov. Stein's veto of FSTC opt-in bill (HB 87) Date: 2026-05-20. Category: state-action. State: NC. On May 20, 2026, the [North Carolina](https://eftccredit.com/states/north-carolina) House of Representatives voted 73-46 to override Governor Josh Stein's veto of House Bill 87, the bill that would opt North Carolina into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. The override is not yet complete: the North Carolina Senate must also vote to override before HB 87 becomes law over the governor's objection. Republicans hold enough seats in the Senate to do so without Democratic support. Governor Stein had vetoed the bill, citing concerns about federal education funding cuts and a preference to wait until the U.S. Treasury Department finalized the program's rules. Stein has said he is open to participating in the program, but in a way that would "benefit public schools, as well." Supporters framed the override as a win for families across all educational settings. Rep. Neal Jackson (R-Moore) said the program "supports public school students, charter school students, private school students, and home school students. It allows taxpayers to voluntarily fund student scholarships, and it gives more students access to quality educational environments." House Speaker Destin Hall called the vote "another major win for North Carolina students and parents." Opponents disputed that framing: Rep. Julie von Haefen (D-Wake) argued the "federal voucher program will significantly decrease federal tax revenue and will have a huge impact on our federal budget." If the Senate completes the override, North Carolina would become the third state where the legislature forced participation against the governor's wishes through a veto override, following Kentucky and Kansas. North Carolina families would then be eligible for scholarships through state-designated [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) when the federal program goes live on January 1, 2027. Under §25F, scholarships go to K-12 students in households at or below 300% of the relevant Area Median Gross Income, and donors anywhere in the country can claim a non-refundable federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO. As of late May 2026, the Senate had not yet voted. Sources: - WRAL: NC House overrides Stein veto on federal tax-credit education scholarship bill: https://www.wral.com/news/nccapitol/nc-house-veto-override-trump-tax-credit-education-scholarship-stein-may-2026/ - NC Newsline: NC House overrides Stein veto on federal scholarship tax credit: https://ncnewsline.com/2026/05/20/nc-house-overrides-stein-veto-on-federal-scholarship-tax-credit/ - Ballotpedia: State participation in the federal K-12 education tax credit scholarship program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/north-carolina-house-overrides-stein-veto-may-2026 ### Connecticut's Lamont calls a §25F opt-in “premature,” and wants to see Treasury's rules first Date: 2026-05-20. Category: state-action. State: CT. Connecticut has joined the ranks of blue-state holdouts on the federal Scholarship Tax Credit (FSTC / ECCA / §25F), and Governor Ned Lamont is in no hurry to decide. In remarks to the Connecticut Mirror published May 20, 2026, Lamont, a Democrat, called the prospect of opting Connecticut into the program "premature," saying flatly, "I just think it's premature," and indicating he would rather wait for federal guidance before committing the state one way or the other. It is a noncommittal posture rather than a refusal: Connecticut is neither in nor out, and the governor has left the door open while pointing to the rules that have not yet been written. This is the first Connecticut-specific gubernatorial position we have logged, and it places Lamont alongside the undecided rather than the opposed. The timing of Lamont's comment is what gives it weight. They came as neighboring New York moved in the opposite direction: Governor Kathy Hochul signaled in early May 2026 that New York plans to join the program, a stated intention rather than a completed election, but enough to raise the regional contrast. The federal credit lets a donor give up to $1,700 to a qualifying Scholarship Granting Organization and claim a dollar-for-dollar federal tax credit, with the program set to launch January 1, 2027. Because the scholarships are funded by donors rather than the state treasury, a participating state spends nothing to open the door, which is precisely why a neighbor's decision to opt in tends to sharpen the question for the states still on the fence. We track [how Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026), and Lamont now sits squarely in the wait-and-see column. Lamont is not deliberating in isolation. Patrice McCarthy, executive director of the Connecticut Association of Boards of Education (CABE), publicly backed the governor's instinct to wait for federal guidance, and she framed the hesitation in oversight terms: scholarships routed through private organizations, she argued, lack the public reporting and accountability that govern public-school finances, which in her view creates a serious lack of transparency. That argument echoes the central objection raised by public-education groups nationally, the concern that a program nominally open to all students functions as a channel toward private tuition with thinner public oversight. It is the same fault line visible in [Maryland, where Governor Wes Moore has also declined to tip his hand](https://eftccredit.com/news/maryland-wes-moore-25f-decision-pending-june-2026), and in the broader fight over [who opposes the credit and why](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026). For donors, families, and prospective SGO founders in Connecticut, the practical takeaway is that the state remains pending and the clock is the variable to watch. The Connecticut legislature has adjourned, and as of mid-June 2026 there has been no concrete follow-on development, no governor's press release, no Department of Revenue Services or State Department of Education guidance, no SGO listing activity, and no new bill movement, which leaves Lamont's May remarks as the most current statement of where Connecticut stands. The decision itself may turn less on Hartford than on Washington: Treasury's forthcoming regulations, which the department [previewed in June 2026](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026), are the "federal guidance" Lamont says he is waiting for, and they will define the room a state has to act. Connecticut's current status, and every other state's, is tracked on our [Connecticut state page](https://eftccredit.com/states/connecticut); you can compare it with [New York's](https://eftccredit.com/states/new-york), see who is already operating on the [SGO directory](https://eftccredit.com/sgos), and read how the credit works on our [learn pages](https://eftccredit.com/learn). Sources: - CT Mirror: Lamont hesitant to opt CT into federal scholarship tax credit (May 20, 2026): https://ctmirror.org/2026/05/20/lamont-ct-federal-scholarship-tax-credit-ny-hochul/ Canonical: https://eftccredit.com/news/connecticut-lamont-premature-25f-opt-in-may-2026 ### Three states that said no to the FSTC are reconsidering: Hawaii, New Mexico, and Oregon Date: 2026-05-19. Category: analysis. By mid-May 2026, roughly 30 states had moved toward participating in the federal Scholarship Tax Credit (FSTC / ECCA / §25F), while a handful had affirmatively said they would not. Three of those refusals are now being revisited: according to reporting summarized by Ballotpedia and Education Week, the governors of Hawaii, New Mexico, and Oregon are all reconsidering their positions ahead of the program's January 1, 2027 launch. Minnesota is the exception in that group, where Gov. Tim Walz [said in March that an opt-in was "never going to happen"](https://eftccredit.com/news/minnesota-governor-walz-declines-fstc-march-2026) and has not revisited it. The reconsideration reflects a recurring dynamic in the FSTC debate: because the credit is funded by the federal government rather than state budgets, declining does not save a state money, it simply means donors in that state can still claim the §25F credit by giving to [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) in opted-in states, with those scholarships funding K-12 students elsewhere. The credit follows the SGO's state of operation, not the donor's residence. For a state that stays out, the practical effect is that its own families are not eligible for scholarships while its residents' donations subsidize students in participating states. Several governors who initially declined or vetoed opt-in legislation cited the same reason: the absence of final IRS implementing regulations. Treasury issued Notice 2025-70 in November 2025 to begin that rulemaking and has said it intends to publish proposed regulations. As guidance firms up, the calculus for holdout states may shift, particularly given that the opt-in is an annual decision, so a state that sits out 2027 can still join in 2028 or any later year by submitting a qualifying SGO list to the U.S. Treasury. Whether Hawaii, New Mexico, or Oregon ultimately reverse course remains to be seen; as of late May 2026 none had formally opted in. But the fact that all three declining states are publicly revisiting the question, rather than treating their earlier "no" as final, underscores how fluid the national map remains with more than half a year before the program begins. Sources: - Ballotpedia News: New York governor says state plans to participate in federal education tax credit scholarship program: https://news.ballotpedia.org/2026/05/19/new-york-governor-says-state-plans-to-participate-in-federal-education-tax-credit-scholarship-program/ - Education Week: Federal Program Will Bring Private School Choice to At Least 4 New States: https://www.edweek.org/policy-politics/federal-program-will-bring-private-school-choice-to-at-least-4-new-states/2026/01 - Ballotpedia: State participation in the federal K-12 education tax credit scholarship program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/declined-states-reconsidering-hawaii-new-mexico-oregon-may-2026 ### Diocese of Wilmington launches campaign pressing Gov. Meyer to opt Delaware into the federal Scholarship Tax Credit Date: 2026-05-19. Category: state-action. State: DE. The Catholic Diocese of Wilmington, which covers all of Delaware plus Maryland's Eastern Shore, has become the first organized faith community to mount a dated, state-specific campaign pressing its governors to join the federal Scholarship Tax Credit (FSTC / ECCA / §25F). In a pastoral letter published May 19, 2026 in The Dialog, the diocese's official news outlet, Bishop William E. Koenig implored "all leaders and people of good will" to support the program and to contact their elected officials directly. The diocese also stood up a dedicated advocacy page at cdow.org/fstc carrying an explicit call to action: "Tell Governor Meyer to OPT IN For Delaware's Kids!" The campaign names both Delaware Gov. Matt Meyer and Maryland Gov. Wes Moore, and the diocese confirms that, as of its writing, neither governor had made a decision on participation. This is the most concrete Delaware-specific 25F development to date, and it is distinct in character from the political and budget questions surrounding [Maryland's own pending decision under Gov. Moore](https://eftccredit.com/news/maryland-wes-moore-25f-decision-pending-june-2026): here the engine is a grassroots, faith-based opt-in push organized inside Delaware itself. The stakes the diocese describes track the program's federal mechanics. The credit, which takes effect January 1, 2027, lets a taxpayer claim up to $1,700 per taxpayer for donations to qualifying Scholarship Granting Organizations that fund K-12 scholarships for families under 300% of area median income. Crucially, a state must affirmatively opt in for its students to be eligible, and Bishop Koenig framed a December 31, 2026 deadline for the governors to elect in for tax year 2027 scholarships (the campaign page phrases the same window as opting in "by January 1, 2027"). The diocese's warning is pointed: absent a Delaware opt-in, the federal scholarship dollars that Delaware donors generate do not stay home but instead flow to students in states that have elected to participate. That framing, which treats non-participation as a net export of charitable capacity rather than a neutral pass, is exactly the calculus a growing number of states are weighing. Readers can review the opt-in mechanism in our explainer on the [governor opt-in process](https://eftccredit.com/learn/governor-opt-in-process). The campaign also throws Delaware's current status into relief. The state is absent from the IRS's June 8, 2026 notice (IR-2026-76) listing the 27 states that had elected to participate, and the Defense of Freedom Institute's tracker still classifies Delaware as undecided. There is no Delaware General Assembly bill addressing a 25F opt-in or an SGO list introduced as of mid-June 2026, and the governor's official news page carries no 25F press release. In other words, the diocese is operating in a vacuum of formal state action, which is precisely why an organized outside campaign matters: in Delaware, the opt-in decision currently rests with the executive and the legislature, neither of which has moved. Our [Delaware state page](https://eftccredit.com/states/delaware) reflects that pending status, and the broader [state-by-state tracker](https://eftccredit.com/states) shows how Delaware compares to the 27 states already on the IRS list and to neighbors still deciding. For Scholarship Granting Organizations and prospective donors, the Wilmington campaign is a useful signal even though it changes nothing legally on its own. A pastoral letter and an advocacy website do not enroll Delaware in the program, and the diocese itself is careful to note that the governors retain the decision. But the effort demonstrates that faith-based school networks, which stand to be among the largest beneficiaries of 25F scholarships, are beginning to organize state-level pressure rather than wait on rulemaking in Washington. If Delaware does elect in before the year-end deadline, the organizations positioned to receive donations will need to be on the state's approved SGO list and compliant with the program's structure from day one. Diocesan school systems and independent operators evaluating that path can review the [SGO directory](https://eftccredit.com/sgos) and our guide on [how to start an SGO](https://eftccredit.com/learn/how-to-start-an-sgo). For now, Delaware's participation remains an open question, and the Diocese of Wilmington has made itself the loudest voice asking Gov. Meyer to answer it. Sources: - The Dialog (Diocese of Wilmington): Bishop Koenig implores all leaders, people of good will to support Federal Scholarship Tax Credit (May 19, 2026): http://thedialog.org/education-and-careers/bishop-koenig-of-diocese-of-wilmington-implores-all-leaders-people-of-good-will-to-support-federal-scholarship-tax-credit/ - Diocese of Wilmington: Federal Scholarship Tax Credit campaign page (cdow.org/fstc): https://cdow.org/ministries/catholic-schools/federal-scholarship-tax-credit/ - MyChesco: Wilmington Diocese Urges States to Join School Tax Credit Program (May 22, 2026): https://www.mychesco.com/a/news/regional/wilmington-diocese-urges-states-to-join-school-tax-credit-program/ - IRS: More than half the U.S. states signed up to participate in the federal Scholarship Tax Credit program (IR-2026-76; Delaware absent from the 27-state list): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill Canonical: https://eftccredit.com/news/diocese-of-wilmington-25f-opt-in-campaign-meyer-may-2026 ### Illinois public debate over the Federal Scholarship Tax Credit intensifies as Pritzker decision pends Date: 2026-05-18. Category: state-action. State: IL. With [Illinois](https://eftccredit.com/states/illinois) still undecided on the federal Scholarship Tax Credit (FSTC / ECCA / §25F), mid-May 2026 has brought a noticeable uptick in public pressure on Governor JB Pritzker from both sides. The credit was enacted as part of the One Big Beautiful Bill Act (P.L. 119-21, §70411) on July 4, 2025, and takes effect for donations made on or after January 1, 2027. A state must opt in, with the governor submitting a list of qualifying [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) to the U.S. Treasury, for taxpayers to claim the credit against donations to SGOs in that state. On May 18, 2026, NPR Illinois reported State Rep. Mike Coffey urging Pritzker to opt in, framing participation as "no cost to Illinois taxpayers" because the credit is federal. State Rep. Amy Grant has separately called for Illinois to join, arguing the program would "give Illinois families new tools to help their children succeed without additional costs to the state." On May 15, 2026, the Chicago Sun-Times ran an op-ed by Ralph Martire, Executive Director of the Center for Tax and Budget Accountability, urging Pritzker to decline. Martire argued that the program would cost the federal government an estimated $134 billion in foregone revenue over a decade, that §25F's 300%-of-Area-Median-Gross-Income eligibility ceiling reaches well into the upper-middle class (in his Chicago example, families earning up to roughly $359,700), and that prior studies of state tax-credit and voucher programs have raised concerns about academic outcomes and SGO admissions practices. The basic facts of the program are not in dispute. Under §25F, individual federal taxpayers can claim a non-refundable credit of up to $1,700 per taxpayer for cash contributions to qualifying SGOs in opted-in states; the credit follows the SGO's state of operation, not the donor's residence. Scholarships under §25F can fund tuition, tutoring, educational therapies, testing fees, and other qualified K-12 expenses for students in households at or below 300% of the relevant Area Median Gross Income. What is contested in Illinois, as in other pending states, is whether participation is on balance good policy for the state's students and schools. The opt-in decision is annual: a governor who declines in 2027 can still submit a qualifying SGO list in 2028 or any later year. Illinois is one of roughly 14 states that, as of mid-May 2026, have not publicly committed either way. Sources: - NPR Illinois: A lawmaker urges state leaders to opt in to the Federal Scholarship Tax Credit Program: https://www.nprillinois.org/news/2026-05-18/a-lawmaker-urges-state-leaders-to-opt-in-to-the-federal-scholarship-tax-credit-program-first-listen - Chicago Sun-Times (Ralph Martire op-ed): Gov. Pritzker should say no to the federal tax credit scholarship program: https://chicago.suntimes.com/columnists/2026/05/15/federal-tax-credit-scholarship-educational-choice-children-act-illinois-pritzker-trump-ralph-martire - DuPage Policy Journal: Representative Amy Grant urges Illinois to join federal Education Freedom Tax Credit program: https://dupagepolicyjournal.com/representative-amy-grant-urges-illinois-to-join-federal-education-freedom-tax-credit-program - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/illinois-public-debate-intensifies-pritzker-may-2026 ### §25F becomes a 2026 Connecticut governor's-race issue as Fazio, calling the credit “literally free money,” wins the GOP nomination Date: 2026-05-16. Category: state-action. State: CT. Connecticut's decision on the federal Scholarship Tax Credit (FSTC / ECCA / §25F) has moved from a quiet executive-branch question into the middle of a statewide campaign. On May 16, 2026, at the Republican state convention at Mohegan Sun in Uncasville, State Senator Ryan Fazio (R-Greenwich) won the GOP gubernatorial nomination on the first ballot, taking roughly 92 percent of delegates (reported in some accounts as more than 91 percent) over challenger Betsy McCaughey. Fazio is the most vocal legislative proponent of opting Connecticut into §25F, and his nomination means the program's fate is now tied to a defined contrast between the two men most likely to control it: the challenger who wants in, and the incumbent who has said wait. The contrast is unusually clean because both candidates have said the quiet part out loud. In remarks to the Connecticut Mirror reported May 20, 2026, Fazio described the federal credit as "literally free money" for the state and "a win-win for everybody," reasoning that because the scholarships are funded by donors rather than the state treasury, Connecticut can open the door at no cost to its own budget. Governor Ned Lamont, a Democrat seeking another term, has taken the opposite posture, telling the same outlet, "I just think it's premature," and saying he would rather wait for Treasury's forthcoming guidance, the proposed regulations Treasury has said it will issue no later than the end of September 2026, before committing the state. We covered [Lamont's "premature" comment and his wait-and-see posture](https://eftccredit.com/news/connecticut-lamont-premature-25f-opt-in-may-2026) in full; Fazio's nomination is what converts that posture into a campaign dividing line. The immediate trigger for the renewed Connecticut debate was regional. In early May 2026, New York signaled it intends to join the program, and a neighbor moving in tends to sharpen the question for states still on the fence. The mechanics are straightforward: §25F lets a donor give up to $1,700 to a qualifying Scholarship Granting Organization and claim a dollar-for-dollar federal tax credit, with the program set to launch January 1, 2027, and a participating state spends nothing from its own treasury to open the door. That is the basis for Fazio's "free money" framing. The countervailing view, voiced by Patrice McCarthy of the Connecticut Association of Boards of Education (CABE), sides with Lamont's caution on oversight grounds, arguing that scholarships routed through private organizations lack the public reporting and accountability that govern public-school finances. For donors, families, and prospective SGO founders in Connecticut, the practical takeaway is that the state's posture is now a moving target tied to an election rather than a settled administrative call. Lamont controls the decision today and has parked it pending federal rules; a Fazio victory in November would point the other direction, though the legislature and Treasury's final regulations would still shape the room any governor has to act. The race makes §25F a live issue voters can weigh in on directly, which is rare for a program this technical. Connecticut's current status, and every other state's, is tracked on our [Connecticut state page](https://eftccredit.com/states/connecticut); you can compare it with [New York's](https://eftccredit.com/states/new-york), see who is already operating on the [SGO directory](https://eftccredit.com/sgos), and read how the credit works on our [learn pages](https://eftccredit.com/learn). Sources: - CT Mirror: Lamont hesitant to opt CT into federal scholarship tax credit, after NY moves to join (May 20, 2026): https://ctmirror.org/2026/05/20/lamont-ct-federal-scholarship-tax-credit-ny-hochul/ - CT Mirror: Ryan Fazio wins the CT GOP nomination for governor (May 16, 2026): https://ctmirror.org/2026/05/16/ryan-fazio-wins-the-ct-gop-nomination-for-governor/ - Connecticut Public: Ryan Fazio wins the CT GOP nomination for governor (May 16, 2026): https://www.ctpublic.org/2026-05-16/ryan-fazio-wins-the-ct-gop-nomination-for-governor Canonical: https://eftccredit.com/news/connecticut-fazio-25f-governors-race-may-2026 ### Massachusetts coalition of 124 organizations launches to push Gov. Healey into the §25F scholarship tax credit Date: 2026-05-13. Category: state-action. State: MA. A new advocacy coalition launched in Massachusetts on May 13, 2026 to pressure Gov. Maura Healey to opt the state into the federal Education Freedom Tax Credit (§25F), the dollar-for-dollar credit for donations to nonprofit scholarship-granting organizations. The Massachusetts Educational Opportunities Coalition (macoalition.com), spearheaded by the National Parents Union and backed by the Pioneer Institute, the Lynch Foundation, and the Boston Foundation, counted 124 member organizations on launch day, according to reporting by the Bay State Banner. That launch-day roster included 45 individual Catholic schools, 18 Montessori schools, and 13 Jewish day schools, alongside umbrella school organizations and dozens of YMCAs and Boys and Girls Clubs. Former Lt. Gov. Tim Murray, now president of the Worcester Regional Chamber of Commerce, estimated the credit could generate roughly $660 million annually in Massachusetts. The mechanics behind the campaign are specific. Under §25F, a state participates only when its governor files an advance election with the IRS and designates qualifying Scholarship Granting Organizations (SGOs). As one coalition framing put it, "The governor has to opt in to get this benefit." Once a state elects in, donors anywhere in the country can claim a dollar-for-dollar federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO, which then awards K-12 scholarships to families. The credit goes live January 1, 2027. The coalition's central pitch is that the program "costs the state nothing" because the scholarship money comes entirely from private donations rather than the state budget, an advocacy argument rather than an independently verified fiscal finding. We track the statutory detail behind the cap in our explainer on why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Healey, a Democrat, has not committed. Her administration has said it is waiting on guidance from the U.S. Treasury and the Department of Education before deciding, a posture that places Massachusetts among the blue states still on the sidelines as the 2027 launch approaches. That fence-sitting stands in contrast to the 27 states the IRS counted on its [advance-election roster](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) by mid-2026, and to neighboring [New York, where Gov. Kathy Hochul signaled she would opt in](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026). The Massachusetts standoff is one more data point in how [Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026): some leaning in, others waiting for federal cover. The coalition's strategy is to build a broad, cross-sector membership base, faith schools, secular schools, and community organizations, large enough that opting in becomes politically easier than continuing to decline. For donors, families, and prospective SGO founders, the practical takeaway is that Massachusetts remains a non-participating state for now. There is no Massachusetts program to plan around, only an executive decision that has not been made, which means Massachusetts taxpayers cannot yet route §25F-eligible donations to in-state organizations and Massachusetts families cannot receive the scholarships. If Healey does elect in, the state would need a slate of designated SGOs ready to intake donations, verify family eligibility, and disburse scholarships before the January 2027 launch. Operators thinking about standing up one of Massachusetts's first SGOs can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current national landscape in the [SGO directory](https://eftccredit.com/sgos); the back-office work of intake, eligibility checks, and scholarship disbursement can be run on software built specifically for §25F. Massachusetts's current status, and every other state's, is tracked on our [Massachusetts state page](https://eftccredit.com/states/massachusetts) and the [national participation map](https://eftccredit.com/states). It is worth noting that the coalition has grown well beyond its launch-day footprint. As of mid-June 2026, macoalition.com describes a membership of more than 6,000 organizations and frames its potential impact around a different figure, roughly $333 million annually at a 15% participation rate, rather than the 124-organization launch framing. The forward question is whether that organizing momentum, and whatever guidance Treasury ultimately issues, is enough to move Healey from "evaluating" to filing an advance election before the 2027 launch. With an organized cross-sector campaign at home and a neighboring blue state already leaning in, whether Massachusetts participates will be measured by one thing: whether the governor ever files an advance election with the IRS. Sources: - Massachusetts Educational Opportunities Coalition (official site): https://www.macoalition.com/ - Franklin Observer (StateHouse News wire): Critics say Massachusetts missing out on chance to lift education: https://franklinobserver.town.news/g/franklin-town-ma/n/378661/critics-say-massachusetts-missing-out-chance-lift-education - StateHouse News: Critics say Massachusetts missing out on chance to lift education: https://www.statehousenews.com/news/education/critics-say-massachusetts-missing-out-on-chance-to-lift-education/article_89e88e39-fda5-4b30-ab65-328d04c2f8ae.html Canonical: https://eftccredit.com/news/massachusetts-educational-opportunities-coalition-launch-healey-25f-may-2026 ### New Jersey Gov. Sherrill won't commit to §25F opt-in, says she will 'evaluate' after Treasury finalizes rules Date: 2026-05-12. Category: state-action. State: NJ. New Jersey Gov. Mikie Sherrill has declined to commit to opting New Jersey into the federal Education Freedom Tax Credit (§25F), telling Jewish Insider on May 12, 2026 that she will wait for federal rules before deciding. In a statement reported by the outlet, deputy press secretary Maggie Garbarino said the governor "will evaluate the program once the Trump Administration has finalized and published its rules," and stressed that Sherrill's top priority is building New Jersey into the best public school system in the nation for all of the state's children. Sherrill, a Democrat, was sworn in on January 20, 2026 as New Jersey's 57th governor. The non-committal posture leaves New Jersey off the IRS advance-election roster, which counted 27 states as of mid-April 2026, none of them New Jersey. The timing is notable. The statement came days after neighboring New York signaled it would participate: Gov. Kathy Hochul committed to opt in during a meeting with Jewish leaders, a verbal commitment reported by Jewish Insider on May 8, 2026 and folded into her FY2027 executive budget proposal. New York has not yet filed a formal advance election with the IRS, and Hochul, like Sherrill, said her office wants to review the federal details first. But the contrast placed Sherrill's "evaluate later" language against a neighboring Democratic governor who had already [said yes in principle](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026). We track that broader divide in our coverage of how [Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). The mechanics behind the decision are straightforward. Under §25F, a state opts in when its governor files an advance election with the IRS (Form 15714) and designates qualifying Scholarship Granting Organizations (SGOs). Donors anywhere in the country can then claim a dollar-for-dollar federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO, which awards K-12 scholarships to families earning up to 300% of their area median gross income. The credit goes live January 1, 2027. A state that does not file an election simply does not have a program: its residents see no in-state SGOs to give to, and its families cannot receive the scholarships, even though the federal credit exists. For the statutory detail on the cap, see our explainer on why the credit is [$1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). For donors, families, and prospective SGO founders, the practical takeaway is that New Jersey remains a non-participating state for now. There is no New Jersey program to plan around, only an executive decision that has not been made, which means New Jersey taxpayers cannot yet route §25F-eligible donations to in-state organizations. A grassroots push is trying to change that: OptInNJ.org, run by the NJ Academic Access Coalition of parents, educators, and community members, is urging Sherrill to issue New Jersey's intent to opt in before the January 1, 2027 launch. New Jersey's current status, and every other state's, is tracked on our [New Jersey state page](https://eftccredit.com/states/new-jersey) and the [national participation map](https://eftccredit.com/states). Operators thinking about standing up one of New Jersey's first SGOs, so the infrastructure exists if and when the state elects in, can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current landscape in the [SGO directory](https://eftccredit.com/sgos); the back-office work of intake, eligibility checks, and scholarship disbursement can be run on software built specifically for §25F. The forward question is whether the federal rules Sherrill is waiting on arrive in time to force a decision before the 2027 launch. Treasury has begun previewing its §25F regulations, and the closer the program gets to January 1 without a New Jersey election, the longer New Jersey donors will hold credit-eligible dollars with no in-state place to send them. With a neighboring blue state already leaning in and an organized opt-in campaign at home, whether Sherrill's "evaluate" stance becomes a yes will be measured by one thing: whether New Jersey ever files an advance election with the IRS. Sources: - Jewish Insider: Mikie Sherrill to evaluate N.J. adoption of federal Education Freedom Tax Credit (May 12, 2026): https://jewishinsider.com/2026/05/mikie-sherrill-education-tax-initiative-not-committed-kathy-hochul/ - Jewish Insider: Kathy Hochul embraces tax initiative for Jewish education (May 8, 2026): https://jewishinsider.com/2026/05/kathy-hochul-new-york-tax-credit-jewish-education/ - OptInNJ.org: NJ Academic Access Coalition petition: https://optinnj.org/ - Patch NJ: A School Choice Tax Credit Is Waiting. How Long Until New Jersey Opts In?: https://patch.com/new-jersey/hoboken/school-choice-tax-credit-waiting-long-new-jersey-opts - New Jersey Policy Institute: Education Freedom Tax Credit: https://newjerseypolicyinstitute.org/about/education-freedom-tax-credit/ - IRS: Treasury, IRS allow states to make an advance election to participate in the new federal tax credit for contributions to SGOs (OBBB): https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill Canonical: https://eftccredit.com/news/new-jersey-sherrill-noncommittal-25f-evaluate-may-2026 ### What pending states stand to forgo: a closer look at Pennsylvania Date: 2026-05-09. Category: analysis. State: PA. With New York's May 8, 2026 announcement, the count of states moving toward participation in the federal Scholarship Tax Credit (FSTC / ECCA / §25F) continues to grow. But 14 states, including several of the country's most populous, remain undecided, and the program's January 1, 2027 launch is approaching. [Pennsylvania](https://eftccredit.com/states/pennsylvania), where Governor Josh Shapiro has not announced a decision, has emerged as one of the most-watched holdouts. What does "not opting in" cost residents of a pending state? In practical terms: donors anywhere in the country can still claim the §25F federal credit (up to $1,700 per taxpayer) by giving to [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) in opted-in states, but the scholarships those donations fund will go to K-12 students in the opted-in states, not back home. The credit follows the SGO's state of operation, not the donor's residence. States must designate their qualifying SGOs through the governor's annual submission to the U.S. Treasury. The America First Policy Institute (AFPI), an advocacy organization, publishes an "EFTC Donation Impact Projector" that estimates state-level foregone donations under different participation assumptions. For Pennsylvania, the projector estimates approximately $1.97 billion in foregone scholarship funding over the 2027-2029 window if the state does not opt in, translating to roughly 354,000 scholarships at a $5,000 average. The projector uses 2022 IRS Statistics of Income filer counts and assumes a 10% individual / 6% joint baseline participation rate rising 2 points annually, rates the tool notes are "set well below" the 41.4% participation observed for the CARES Act charitable deduction. Numbers from advocacy projectors should be read as illustrative scenarios with stated assumptions, not as official forecasts; actual takeup will depend on donor behavior, final IRS rulemaking under Notice 2025-70, and the SGO ecosystem that develops in each state. The opt-in decision is annual: a governor who declines in 2027 can still submit a qualifying SGO list in 2028 or any subsequent year. For Pennsylvania and other pending states, including New Jersey, Illinois, Michigan, Massachusetts, Maryland, California, Washington, and others, that means the cost of waiting is bounded by the program year, but compounds annually as long as the state stays out. Eligible students under §25F are those in households at or below 300% of the relevant Area Median Gross Income, and scholarship funds can support tuition as well as a range of other educational expenses including tutoring, educational therapies, testing fees, and educational software. Sources: - AFPI: The Cost of Opting Out, EFTC Donation Impact Projector: https://afpieftc.netlify.app/ - RealClearEducation: A Free Win for Governors, If They'll Take It: https://www.realcleareducation.com/articles/2026/04/23/a_free_win_for_governors_if_theyll_take_it_1178694.html - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ Canonical: https://eftccredit.com/news/pending-states-whats-at-stake-pennsylvania-may-2026 ### Colorado Gov. Polis publicly defends his FSTC opt-in at Denver event Date: 2026-05-09. Category: state-action. State: CO. On May 9, 2026, [Colorado](https://eftccredit.com/states/colorado) Governor Jared Polis appeared at an Invest in Education Foundation event at the Denver Museum of Nature and Science to publicly defend his December 2025 decision to opt Colorado into the federal Scholarship Tax Credit (FSTC / ECCA / §25F). About 150 educators, parents, and students attended, according to Chalkbeat Colorado. The event came against the backdrop of recent state-legislative pushback. Colorado lawmakers had shelved a bill that would have required [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) receiving §25F-credited funds to comply with Colorado's anti-discrimination laws, a measure Polis's office had opposed on the grounds that it would discourage SGO participation in the state. Polis drew a distinction between the federal credit and state-funded programs. "When you give $100 to any charity, it can be a church, it can be something that discriminates," he said, framing §25F as a federal tax incentive for private giving rather than a public expenditure subject to state non-discrimination rules (as in, for example, Colorado's universal preschool program). He said opting in "puts more control of a child's education in the hands of their parents," and reiterated his earlier rationale that Colorado shouldn't "leave money on the table" while other states stay out. Under §25F, individual federal taxpayers can claim a non-refundable credit of up to $1,700 per taxpayer for cash contributions to qualifying SGOs in opted-in states. The credit takes effect for donations made on or after January 1, 2027. Scholarships must go to K-12 students whose household income is at or below 300% of the relevant Area Median Gross Income, and can fund tuition, tutoring, educational therapies, testing fees, and other qualified expenses. Sources: - Chalkbeat Colorado: Polis defends his decision to opt Colorado into Trump-backed education tax credit: https://www.chalkbeat.org/colorado/2026/05/09/colorado-governor-jared-polis-talks-federal-education-tax-credit-program/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/colorado-governor-polis-defends-opt-in-may-2026 ### New York Gov. Hochul announces opt-in to Federal Scholarship Tax Credit (FSTC / ECCA) Date: 2026-05-08. Category: state-action. State: NY. On May 8, 2026, [New York](https://eftccredit.com/states/new-york) Governor Kathy Hochul announced that New York intends to opt into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. Hochul disclosed the plan at a private gathering with Agudath Israel of America and incorporated it into her FY2027 executive budget proposal. A spokesperson for the governor confirmed the plan to Jewish Insider, saying Hochul told Jewish leaders she will opt in. The announcement is not the same as formal certification. Hochul's office told Chalkbeat New York that it "awaits information from the federal government on the program and will thoroughly review the details of the policy for poison pills that could harm New York's education system." Under §25F, each participating state's governor submits a list of qualifying [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) to the U.S. Treasury; states have several months to complete that step ahead of the program's January 1, 2027 launch. If New York completes the opt-in, families across the state will be eligible for scholarships through state-designated SGOs once the program goes live. Federal taxpayers anywhere in the country can claim a non-refundable federal income tax credit of up to $1,700 per taxpayer for donations to a qualifying SGO; under §25F, scholarships must go to K-12 students in opted-in states whose household income is at or below 300% of the relevant Area Median Gross Income. Implementing guidance from the IRS is still in development. Treasury issued Notice 2025-70 in November 2025 seeking public comment on issues including state certification, SGO requirements, donor substantiation, and household-income verification, the kinds of details Hochul's office indicated it wants to review before finalizing. The annual structure of the opt-in means New York's participation, once certified, must be re-certified each January 1 in future years. Sources: - Chalkbeat New York: New York Gov. Hochul plans to opt into federal tax-credit scholarship: https://www.chalkbeat.org/newyork/2026/05/08/kathy-hochul-opts-into-federal-tax-scholarship-school-choice/ - THE CITY: Hochul Intends to Opt Into Federal Tax Credit in Win for Private School Choice: https://www.thecity.nyc/2026/05/08/hochul-school-choice-tax-credit-voucher/ - The 74: New York Gov. Hochul Plans to Opt Into Federal Tax-Credit Scholarship: https://www.the74million.org/article/new-york-gov-hochul-plans-to-opt-into-federal-tax-credit-scholarship/ - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026 ### Connecticut's only §25F vote of 2026 was a doomed floor amendment. The legislative door is now closed until the governor acts. Date: 2026-05-06. Category: state-action. State: CT. Connecticut's 2026 legislative session produced exactly one recorded attempt to join the federal Scholarship Tax Credit (FSTC / ECCA / §25F), and it never had a path to passage. During a late-night Senate debate on May 4, 2026 over HB 5468, a homeschool oversight bill, Sen. Ryan Fazio (R-Greenwich) offered a floor amendment that would have opted Connecticut into the program, describing the federal credit as "literally free money" for the state. The amendment was one of 39 that Republicans filed against the bill; the majority Democrats defeated nine of them and the remaining amendments were withdrawn. By the reporting on the debate, the §25F amendment did not pass. HB 5468 itself cleared the Senate 22-14 near midnight. The mechanics of §25F are what made the amendment attractive to its sponsor and unobjectionable on cost. The program, which launches January 1, 2027, lets individual taxpayers claim a federal credit of up to $1,700 for donations to qualifying Scholarship Granting Organizations, with the scholarships funded by donors rather than the state treasury. A state's only required act is for the governor to opt in by submitting a list of eligible SGOs to the U.S. Treasury. That structure is why Fazio framed participation as costless to Connecticut taxpayers. It is also why opting in is, by statute, an executive decision rather than a legislative one, which left the floor amendment as a political signal more than a viable vehicle. Whatever the amendment's merits, the calendar closed the question for the year. The Connecticut General Assembly adjourned its 2026 regular session sine die on May 6, 2026, two days after the HB 5468 debate. Adjournment means no further bill can opt the state in until a future session convenes, so for the rest of 2026 the legislative route is shut. That leaves a single remaining path: a unilateral opt-in by Gov. Ned Lamont. In coverage dated May 20, 2026, Lamont was noncommittal, calling the move premature and signaling he would rather wait for federal guidance, the proposed §25F regulations Treasury has said it will issue no later than the end of September 2026. His hesitancy stood out against neighboring New York, where Gov. Kathy Hochul had just moved to join the program. Connecticut now sits in the same holding pattern as several other Democratic-led states: the door to participation is open through the governor's pen but unused, with the legislature unable to force the issue. For donors, families, and anyone considering founding an SGO in the state, that means there is no Connecticut program to plan around yet, only an executive decision that has not been made. We track the state's status and every other state's on our [Connecticut state page](https://eftccredit.com/states/connecticut) and the [state participation map](https://eftccredit.com/states). For context on the broader divide, see our coverage of [New York's opt-in under Gov. Hochul](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026) and [how Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). Operators weighing whether to stand up an SGO can start with our [explainer on how the credit works](https://eftccredit.com/learn) and our [directory of Scholarship Granting Organizations](https://eftccredit.com/sgos). Sources: - CT Mirror: Lamont noncommittal on federal scholarship tax credit after NY moves to join (May 20, 2026): https://ctmirror.org/2026/05/20/lamont-ct-federal-scholarship-tax-credit-ny-hochul/ - CT News Junkie: Senate Passes Homeschool Oversight Bill In Late-Night Session (May 4, 2026): https://ctnewsjunkie.com/2026/05/04/senate-passes-homeschool-oversight-bill-in-late-night-session/ Canonical: https://eftccredit.com/news/connecticut-fazio-25f-amendment-fails-sine-die-may-2026 ### Tennessee enacts §25F enabling law (Public Chapter 720): DOE to certify SGOs, and homeschoolers are in Date: 2026-05-05. Category: state-action. State: TN. On May 5, 2026, Tennessee enacted SB 2206, the "Federal Tax Credit Scholarship Act," which was signed by the governor and assigned Public Chapter Number 720. The measure, carried by primary sponsor Sen. Jack Johnson (R, District 27), cleared the Senate 27 to 5 on March 19 and the House 75 to 19 on March 30 before reaching the governor's desk. It is Tennessee's enabling statute for the federal Education Freedom Tax Credit under Internal Revenue Code §25F, the program that provides a 100% federal income tax credit of up to $1,700 for an individual's qualified cash contribution to an eligible scholarship granting organization (SGO). The act takes effect for taxable years beginning after December 31, 2026, lining up with the §25F program's January 1, 2027 launch. The law spells out the mechanics on the state side. It directs the Commissioner of the Department of Education to elect to participate in the federal program, to certify eligible scholarship granting organizations, to submit that list of certified SGOs to the U.S. Secretary of the Treasury, and to publish the list on the department's website. The state-level election by the Commissioner is what pairs with the federal advance-election step (IRS Form 15714), which we explain in our coverage of [the advance-election mechanism](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025). Tennessee's Fiscal Review Committee classified the bill's fiscal impact as not significant, on the basis that the work can be absorbed by existing department staff and resources rather than new state spending. Tennessee now appears on the IRS roster of participating states published June 8, 2026, which we track alongside the [running national list of advance-election states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). The detail that sets Tennessee apart is who can use the scholarships. The act's scholarships cover qualified elementary and secondary expenses, and the fiscal note explicitly states that this includes homeschool expenses, as federal law permits. That is a deliberate contrast with Tennessee's own 2025 Education Freedom Scholarship Act, the state-funded program that excludes homeschool expenses. In other words, families educating children at home, who are shut out of the state's flagship 2025 program, are squarely inside the §25F channel that Public Chapter 720 builds. That divergence is part of a broader 50-state pattern we have documented, in which the federal credit reaches homeschoolers in places where state-level dollars do not. For SGOs and donors, the practical takeaway is that Tennessee has chosen the certification-and-submission route rather than waiting on the sidelines. Once the Department of Education certifies organizations and publishes the list, qualifying nonprofits can begin accepting contributions that yield the dollar-for-dollar federal credit, a figure the statute already settles at $1,700 even while joint-filer treatment remains contested, which we cover in [our breakdown of the cap](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Because §25F lets any qualifying nonprofit operate as an SGO, in-state organizations and national operators alike can compete for Tennessee donors and families. Operators standing up a program, in Tennessee or elsewhere, can run a §25F operation on software purpose-built for the credit, and our [directory of scholarship granting organizations](https://eftccredit.com/sgos) and [explainers](https://eftccredit.com/learn) track who is forming programs in each state. What to watch next is the certification timeline: how quickly the Department of Education names eligible SGOs, submits the list to Treasury, and publishes it ahead of the January 1, 2027 launch, and how many organizations choose to serve Tennessee's homeschool families specifically. With the enabling statute on the books, the question shifts from whether Tennessee participates to who administers the dollars. We track Tennessee's status and participating organizations on the [Tennessee state page](https://eftccredit.com/states/tennessee) and follow the national rollout on the [participation map](https://eftccredit.com/states) as more states finalize their elections. Sources: - Tennessee General Assembly: SB 2206 bill history (Public Chapter 720, signed 05/05/2026): https://wapp.capitol.tn.gov/apps/BillInfo/Default.aspx?BillNumber=SB2206&GA=114 - Tennessee Fiscal Review Committee: SB 2206 / HB 2187 fiscal note (Feb. 28, 2026): https://capitol.tn.gov/Bills/114/Fiscal/SB2206.pdf - IRS: More than half the U.S. states signed up to participate in the Federal Scholarship Tax Credit (IR-2026-76, lists Tennessee): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill Canonical: https://eftccredit.com/news/tennessee-enacts-25f-enabling-law-public-chapter-720-homeschoolers-included-may-2026 ### Colorado lawmakers kill their own bill to put state guardrails on the §25F SGO list Date: 2026-04-30. Category: state-action. State: CO. Colorado has spent more time inside the federal Scholarship Tax Credit (FSTC / ECCA / §25F) than almost any Democratic-led state, and on April 30, 2026 its legislature quietly decided not to wall the program off. The House Education Committee voted 11-0 to postpone HB26-1292 indefinitely, killing the only bill that would have attached state conditions to Colorado's participation. Introduced February 23, 2026 and titled simply "Scholarship Granting Organizations," the measure carried prime sponsors Rep. Lori Goldstein (D-Westminster) and Sens. Cathy Kipp and Janice Marchman, all Democrats. The committee's roster of action lists the bill's status, plainly, as Lost. With the 2026 session closing without a replacement, Colorado will enter §25F on January 1, 2027 with no state-added SGO or school-eligibility restrictions. What the bill would have done is the substance of the story. HB26-1292 would have required Colorado to include every OBBBA-eligible Scholarship Granting Organization (SGO) on the list it submits to the U.S. Treasury, removing state discretion to omit organizations, while simultaneously imposing nondiscrimination requirements on the private schools that enroll scholarship recipients. Those requirements reached across race, religion, disability, sexual orientation, and gender identity, and the bill folded in disability-law obligations as well. It was, in effect, an attempt to take the federal credit on Colorado's civil-rights terms: list all qualifying SGOs as the statute demands, but condition the schools downstream. Backers included the Colorado Education Association and a set of school districts; opposition came from the Colorado Association of Private Schools and Christian Home Educators of Colorado, the constituencies the conditions would have bound. The decisive opposition, though, came from inside the party. Gov. Jared Polis's office said the bill "would hamstring the state's ability to bring new funding for much-needed services like afterschool programming and tutoring," a notable position given that Polis had been among the earliest Democratic governors to [opt Colorado in back in December 2025](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025) and had [publicly defended that decision](https://eftccredit.com/news/colorado-governor-polis-defends-opt-in-may-2026) against anti-discrimination objections days after the committee vote. It is worth not overstating the intent behind the 11-0 motion: sponsor Rep. Goldstein framed the postponement as a decision to wait for finalized federal rules and to gather more stakeholder input, not as a hostile burial. The procedural reality is nonetheless striking. A Democratic-controlled committee unanimously shelved its own party's SGO-restriction bill, leaving Colorado's §25F list unconditioned for the program's launch. The defeat doubles as a data point in the larger [floor-versus-ceiling debate](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026) over how much authority states actually have. Treasury's November 2025 notice had already indicated that states may lack the power to add SGO requirements beyond what OBBBA sets, the exact question HB26-1292 would have tested in court had it passed. By stepping back to await federal guidance instead, Colorado avoided the collision that [Vermont's H.933 invites](https://eftccredit.com/news/vermont-h933-restrict-25f-opt-in-june-2026), where lawmakers legislated the strings directly. The contrast is the takeaway for donors and prospective SGO operators: the Democratic state furthest into §25F declined to test state guardrails, signaling a cleaner, less encumbered participation path in Colorado. The §25F donor credit remains capped at $1,700 per taxpayer and the program still launches January 1, 2027 regardless of how the state-conditions fight resolves, but where a state lands on guardrails shapes which SGOs can list and which schools can enroll recipients, and Colorado just removed that variable, at least for now. Current status for Colorado and every other state is tracked on our [Colorado state page](https://eftccredit.com/states/colorado) and the [participation map](https://eftccredit.com/states), and operators weighing a launch can review the [SGO directory](https://eftccredit.com/sgos) and [the explainers](https://eftccredit.com/learn). Sources: - Colorado General Assembly: HB26-1292 bill page and action history (postponed indefinitely 04/30/2026, status Lost): https://leg.colorado.gov/bills/HB26-1292 - CPR News: Colorado lawmakers won't pursue bill to place state limits on Trump-backed education tax credit (May 1, 2026): https://www.cpr.org/2026/05/01/colorado-lawmakers-postpone-bill-aimed-at-trump-education-tax-credit/ - Chalkbeat: The education bills that passed and failed during the 2026 Colorado legislative session (May 14, 2026): https://www.chalkbeat.org/colorado/2026/05/14/2026-colorado-legislative-session-education-bills-that-passed-and-failed/ - Ballotpedia News: Colorado Democrats introduce bill with requirements for schools receiving federal scholarship funds (Mar 18, 2026): https://news.ballotpedia.org/2026/03/18/colorado-democrats-introduce-bill-with-requirements-for-schools-receiving-federal-school-choice-tax-credit-scholarship-funds/ Canonical: https://eftccredit.com/news/colorado-house-kills-hb26-1292-sgo-guardrails-april-2026 ### Senate Democrats introduce bill to repeal the federal scholarship tax credit Date: 2026-04-24. Category: federal-action. On April 24, 2026, a group of Senate Democrats introduced legislation to repeal §25F, the federal income tax credit for donations to scholarship granting organizations (SGOs) created by the Educational Choice for Children Act (ECCA) and known to the IRS as the Federal Scholarship Tax Credit (FSTC). The credit was enacted as part of the One Big Beautiful Bill Act (P.L. 119-21, §70411) on July 4, 2025. The repeal effort comes as more than half of U.S. states are weighing whether to opt in to the program, and as the IRS works toward implementing regulations ahead of the program's January 1, 2027 launch. Sponsors of the repeal bill have argued the credit primarily benefits higher-income donors and could divert federal tax revenue toward private and religious schools without sufficient public oversight. Repeal in the current Congress is widely viewed as unlikely without a change in chamber control, given that the program was enacted through budget reconciliation. But the introduction signals that the political fight over the federal scholarship credit is far from settled, and could resurface in future budget cycles or tax legislation. For donors and families, the practical effect for now is unchanged: §25F remains the law, the program is on track to begin January 1, 2027, and state opt-in decisions continue. (In June 2026 House Democrats added a companion repeal bill, making the effort bicameral but not changing those odds; we cover it within [who opposes §25F](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026).) For operators, the takeaway is that §25F's legal foundation is solid heading into launch, and the practical work of choosing a state, standing up a Scholarship Granting Organization, and preparing donor receipting can proceed now. We walk through how the credit works in our [explainers](https://eftccredit.com/learn) and track each state's posture on the [participation map](https://eftccredit.com/states). Sources: - Ballotpedia News: Senate Democrats introduce bill to repeal federal education tax credit scholarship: https://news.ballotpedia.org/2026/04/24/senate-democrats-introduce-bill-to-repeal-federal-education-tax-credit-scholarship/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/senate-democrats-introduce-ecca-repeal-bill-april-2026 ### Oklahoma locks §25F participation into statute: Stitt signs HB 3704, names Tax Commission as SGO administrator Date: 2026-04-17. Category: state-action. State: OK. Oklahoma has written its participation in the federal Education Freedom Tax Credit (§25F) into permanent statute. House Bill 3704, authored by Representative Denise Crosswhite Hader (R-Piedmont) and carried in the Senate by Senator Daniels, declares that the state "hereby elects to participate, to the fullest extent permitted by federal law," in the §25F program. Governor Kevin Stitt (R) approved the bill on April 17, 2026, according to the official Oklahoma Legislature bill tracker, after the measure was sent to his desk on April 16. The Governor's office folded the signing into an April 20 newsroom announcement listing it among twelve bills enacted that week. The federal credit it locks in is a dollar-for-dollar credit of up to $1,700 per individual taxpayer for contributions to scholarship granting organizations, with scholarships limited to households earning no more than 300 percent of county or area median income, and the program takes effect January 1, 2027. The vote margins underscore how settled the question was in Oklahoma. The House passed HB 3704 on March 23, 2026 by 73 to 20, and the Senate followed on April 15, 2026 by 38 to 8. The bill's central mechanical contribution is designating the Oklahoma Tax Commission as the administering agency: the OTC is responsible for identifying and registering eligible scholarship granting organizations and for maintaining the approved list that Oklahoma provides to the U.S. Treasury. The statute pairs that grant of authority with a deliberate limit, barring state agencies, including the Tax Commission and the Governor, from adopting rules beyond what federal law requires. That is a clear signal that Oklahoma wants its §25F framework to track Treasury's national rules rather than layer on state-specific guardrails, an approach we examine in our coverage of whether §25F is a [federal floor or a ceiling on state restrictions](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026). HB 3704 is best understood as a statutory backstop rather than the first act of participation. Stitt had already initiated Oklahoma's entry into §25F by executive action earlier in 2026; the legislature then converted that choice into law so it no longer depends on a sitting governor's continued cooperation. This is the same durability logic that drove [Idaho to codify its own executive opt-in](https://eftccredit.com/news/idaho-hb-731-codifies-25f-opt-in-march-2026) and that distinguishes statutory participants from the states that came in by governor's pen alone, such as [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026). For a program whose viability rests on a state's standing election to the Treasury, putting the election in statute reassures donors and scholarship organizations that Oklahoma is a stable place to build. For scholarship granting organizations, the operative news is that Oklahoma now has a named registrar. Organizations that want to receive §25F contributions in the state will register with the Oklahoma Tax Commission, which compiles and maintains the list submitted to Treasury; final §25F approval authority still runs through the state's election and the federal process, but the OTC is the practical front door for Oklahoma SGOs. Operators evaluating whether to organize in the state can review our [directory of scholarship granting organizations](https://eftccredit.com/sgos) and our [primer on how §25F works](https://eftccredit.com/learn), and those standing up a program from scratch can run intake, scholarship awards, and Treasury-facing reporting on software built specifically for §25F rather than retrofitting general nonprofit tools. Oklahoma joins a fast-growing roster of states locking in their §25F status ahead of the January 1, 2027 launch, a group the IRS began formalizing when it published its [official list of 27 states that filed advance elections](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). With the $1,700 per-taxpayer cap and the 300 percent income ceiling fixed in federal law, and with Treasury's previewed proposed regulations expected to set the national implementation calendar, the remaining questions in Oklahoma are operational: how quickly the Tax Commission stands up SGO registration and how the approved list reaches Treasury in time for the first credit year. We track Oklahoma's standing and every other state's on the [Oklahoma state page](https://eftccredit.com/states/oklahoma) and the national [participation map](https://eftccredit.com/states). Sources: - Oklahoma Legislature: HB 3704 bill tracker (official history): http://www.oklegislature.gov/BillInfo.aspx?Bill=HB3704&Session=2600 - Oklahoma Governor newsroom: Gov. Stitt signs 12 bills into law (Apr 20, 2026 announcement listing HB 3704): https://oklahoma.gov/governor/newsroom/newsroom/2026/governor-stitt-signs-12-bills-into-law-vetoes-1.html - Oklahoma House: Crosswhite Hader Celebrates Federal Scholarship Tax Credit Becoming Law: https://www.okhouse.gov/posts/news-20260430_2 - OCPA: House votes to lock in Oklahoma's participation in federal school-choice tax credit: https://ocpathink.org/post/independent-journalism/house-votes-to-lock-in-oklahomas-participation-in-federal-school-choice-tax-credit - MuskogeePolitico: With new law, Oklahomans can donate to scholarships under the federal Education Freedom Tax Credit: https://www.muskogeepolitico.com/2026/05/with-new-law-oklahomans-can-donate-to.html Canonical: https://eftccredit.com/news/oklahoma-hb-3704-codifies-25f-tax-commission-administrator-april-2026 ### Arizona Gov. Hobbs vetoes a second FSTC opt-in bill (SB 1142) Date: 2026-04-14. Category: state-action. State: AZ. [Arizona](https://eftccredit.com/states/arizona) Governor Katie Hobbs vetoed SB 1142 on April 14, 2026, blocking a second legislative attempt to opt Arizona into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. The veto followed her January 16, 2026 veto of SB 1106, the legislature's first opt-in bill of the session. In her veto message, Hobbs tied her objection to Arizona's experience with its own programs. "We have seen what happens when these types of programs lack accountability, transparency, and oversight," she wrote, adding: "I hope the administration ensures any federal school choice program will have the much-needed guardrails Arizona's ESA program lacks." As with her earlier veto, she emphasized that the federal government had not yet released final regulatory guidance. Arizona's repeated vetoes are notable because the state operates one of the country's largest existing state-level scholarship and Empowerment Scholarship Account (ESA) programs and has well-developed [Scholarship Granting Organization (SGO)](https://eftccredit.com/learn/sgo-guide) infrastructure. For now, the vetoes mean Arizona families will not be eligible for FSTC scholarships when the federal program goes live on January 1, 2027, unless the legislature musters a veto override or a future governor reverses course. The FSTC opt-in is an annual decision, a state submits its list of qualifying SGOs to the U.S. Treasury for each participating year. Arizona could revisit participation in a later year, particularly once the IRS finalizes the proposed regulations it signaled in Notice 2025-70. Arizona donors can still claim the federal §25F credit (up to $1,700 per taxpayer) by donating to SGOs in opted-in states, though those scholarships would fund students elsewhere. Sources: - KJZZ: Hobbs vetoes proposal to opt Arizona into tax credit program to fund private school scholarships: https://www.kjzz.org/politics/2026-04-14/hobbs-vetoes-proposal-to-opt-arizona-into-tax-credit-program-to-fund-private-school-scholarships - Office of the Arizona Governor: Legislative Action Update (April 2026): https://azgovernor.gov/office-arizona-governor/news/2026/04/governor-katie-hobbs-legislative-action-update-4 - Ballotpedia: State participation in the federal K-12 education tax credit scholarship program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/arizona-governor-hobbs-vetoes-second-opt-in-bill-april-2026 ### Kansas legislature overrides Gov. Kelly's veto, opting Kansas into the Federal Scholarship Tax Credit Date: 2026-04-13. Category: state-action. State: KS. The [Kansas](https://eftccredit.com/states/kansas) legislature voted to override Governor Laura Kelly's veto of SB 361 during the April 2026 veto session, opting Kansas into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. Kelly had vetoed SB 361 on April 8, 2026; the override carried with the Kansas House voting 85-38 and the Kansas Senate voting 29-10. (A separate scholarship bill, HB 2468, was also vetoed by Kelly on April 6 but its override fell short by 8 votes in the House.) In her veto message, Kelly said the federal program "needs to be thoroughly vetted to understand the potential impact on funding for our public schools" and that "if it is, in essence, just another voucher program designed to re-direct taxpayer dollars to private schools to the detriment of our public schools, Kansans have made clear they don't want it." The legislature's supermajority override means Kansas will participate despite the governor's objection. For Kansas families, the practical effect is the same as in any other opted-in state: families at or below 300% of the relevant Area Median Gross Income will be eligible to apply for scholarships through state-designated [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) once the federal program begins on January 1, 2027. Kansas donors will be able to claim the federal non-refundable income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO. Kansas joins Kentucky as the second state where the legislature affirmatively forced participation against the governor's wishes through a supermajority override. The FSTC opt-in is an annual decision: each participating state's governor must submit a list of qualifying SGOs to the U.S. Treasury by January 1 of each participating year, so the path to continued participation in future years will depend on the same legislative or gubernatorial dynamics. Sources: - The Sentinel: Legislature overrides veto of federal tax credit scholarship program: https://sentinelksmo.org/federal-tax-credit-scholarship/ - Ballotpedia News: Kansas and Wisconsin governors veto bills opting their states into federal school choice tax credit program: https://news.ballotpedia.org/2026/04/10/kansas-and-wisconsin-governors-veto-bills-opting-their-states-into-federal-school-choice-tax-credit-program/ - KCUR: Kansas Republicans overrode dozens of Gov. Laura Kelly's vetoes. These bills became law: https://www.kcur.org/politics-elections-and-government/2026-04-15/kansas-republicans-veto-override-laura-kelly-law - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ Canonical: https://eftccredit.com/news/kansas-legislature-overrides-kelly-veto-april-2026 ### New Mexico Rep. Rebecca Dow presses Gov. Lujan Grisham on §25F, and the governor is now ‘actively considering’ Date: 2026-04-02. Category: state-action. State: NM. In late March 2026, New Mexico state Representative Rebecca Dow (R-Elephant Butte / Truth or Consequences) sent a public letter to Democratic Governor Michelle Lujan Grisham urging the state to opt into the federal Education Freedom Tax Credit (§25F), and the appeal appears to have moved the needle. On April 2, 2026, gubernatorial spokesman Michael Coleman told the Albuquerque Journal that the governor "is actively considering whether to opt in but is awaiting more information from the Department of Treasury about the flexibility of the funding." That is a measurable softening: in January 2026 Lujan Grisham was reported among three Democratic governors, alongside Oregon's Tina Kotek and Wisconsin's Tony Evers, who said they would not participate. The shift from a flat refusal to active consideration is the news here. Dow's letter, first reported by Source New Mexico on March 31, argued that scholarship-granting organizations serve students "regardless of what type of school they attend," framing the program as "not about shifting students from one system to another" but "about ensuring that every child has access to the same kinds of opportunities and resources." It is worth being precise about what has and has not happened. This is a public letter from a legislator plus a spokesman's statement of deliberation, not an executive order, a statute, a veto, or an IRS advance election. New Mexico has not opted in, and no status-changing action has occurred. What §25F actually offers, once a state participates, is a dollar-for-dollar federal tax credit of up to $1,700 per taxpayer for donations to qualified scholarship-granting organizations (SGOs). Those SGOs then award scholarships to families earning up to 300% of area median income. The credit was created in the One Big Beautiful Bill Act signed in July 2025, and its defining feature is that it only functions in states that affirmatively opt in. New Mexico is currently among the states that have not, which is why Dow's pressure campaign and the governor's posture both matter. For donors and prospective SGO operators in New Mexico, the practical reality for now is that the state is non-participating, so New Mexico taxpayers cannot yet route §25F-eligible donations to in-state organizations. The governor's stated sticking point, Treasury guidance on "the flexibility of the funding," is the kind of administrative detail that has kept several Democratic-led states in a holding pattern, a dynamic we track in our coverage of how [Democratic governors are splitting on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). It contrasts with early movers like Virginia, where [Glenn Youngkin made his state the first to opt in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), and with later Democratic adopters such as [New York under Gov. Kathy Hochul](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026), which shows the partisan line is not absolute. New Mexico's current status, and every other state's, is tracked on our [New Mexico state page](https://eftccredit.com/states/new-mexico) and the [national participation map](https://eftccredit.com/states). Operators thinking about standing up one of New Mexico's first SGOs, so the infrastructure exists if and when the state elects in, can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current national landscape in the [SGO directory](https://eftccredit.com/sgos). The back-office work of donor intake, eligibility verification against the area-median-income threshold, and scholarship disbursement can be run on software built specifically for §25F, which lets a small team be ready to operate the moment a state's election takes effect rather than scrambling afterward. The forward question is whether the Treasury information Lujan Grisham is waiting on, paired with continued legislative pressure from Dow and others, converts "actively considering" into an actual opt-in before the program goes live. New Mexico also has a 2026 election cycle ahead, which means the decision could ultimately fall to the current governor or her successor. For now the signal is directional rather than decisive: a Republican lawmaker's letter has pulled a Democratic governor from refusal to deliberation, and whether that becomes a federal advance election with the IRS is the measure that will matter. Sources: - Albuquerque Journal: Governor still weighing New Mexico's participation in federal education tax credit program (Apr. 2, 2026): https://www.abqjournal.com/news/governor-still-weighing-new-mexicos-participation-in-federal-education-tax-credit-program/3014488 - Source New Mexico: NM Republican lawmaker urges Gov. Lujan Grisham to opt in to federal education tax credit program (Mar. 31, 2026): https://sourcenm.com/2026/03/31/nm-republican-lawmaker-urges-gov-lujan-grisham-to-opt-in-to-federal-education-tax-credit-program/ - News From The States: NM Republican lawmaker urges Gov. Lujan Grisham to opt in (mirror of Source NM): https://www.newsfromthestates.com/article/nm-republican-lawmaker-urges-gov-lujan-grisham-opt-federal-education-tax-credit-program - Wikipedia: Federal Education Freedom Tax Credit Program (§25F mechanics: $1,700, dollar-for-dollar, 300% AMI, opt-in): https://en.wikipedia.org/wiki/Federal_Education_Freedom_Tax_Credit_Program Canonical: https://eftccredit.com/news/dow-presses-lujan-grisham-new-mexico-25f-april-2026 ### Wisconsin Gov. Evers vetoes FSTC / ECCA opt-in bill (AB 602) Date: 2026-03-30. Category: state-action. State: WI. [Wisconsin](https://eftccredit.com/states/wisconsin) Governor Tony Evers vetoed Assembly Bill 602 on March 30, 2026, blocking Wisconsin's participation in the Federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. AB 602 would have required the state to opt in annually by submitting a qualifying [Scholarship Granting Organization (SGO)](https://eftccredit.com/learn/sgo-guide) list to the U.S. Treasury. In his veto message, Evers said the federal program "has no student achievement metrics, no school accountability measures, no minimum or maximum scholarship size, no certain end date, and no cap on how much the federal government can spend." He also pointed to the unfinished federal rulemaking process and the funding pressures on Wisconsin's public schools, writing that public school districts "continue to endure capped and prorated state funding, strict revenue limits, and the need to go to referenda in many cases just to keep up with inflationary pressures." Without an opt-in or a legislative veto override, no SGOs in Wisconsin will be designated for the program's January 1, 2027 launch, and Wisconsin families will not be eligible for FSTC scholarships in 2027. Wisconsin donors can still claim the federal §25F credit (up to $1,700 per taxpayer) by donating to SGOs in opted-in states, but those scholarships will fund students in other states rather than in Wisconsin. The FSTC opt-in is an annual decision. A future legislature, a future governor, or a veto override in the current session could change Wisconsin's status in any subsequent year. The program itself was enacted as Section 70411 of the One Big Beautiful Bill Act (P.L. 119-21) and remains in effect until repealed. Sources: - Wisconsin Examiner: Gov. Tony Evers vetoes Wisconsin participation in federal school choice tax credit program: https://wisconsinexaminer.com/2026/03/30/gov-tony-evers-vetoes-wisconsin-participation-in-federal-school-choice-tax-credit-program/ - WPR: Evers vetoes bill to join federal tax credit program, citing concerns over expansion of school vouchers: https://www.wpr.org/news/wisconsin-evers-vetoes-bill-federal-expansion-private-voucher-schools - Ballotpedia News: Kansas and Wisconsin governors veto bills opting their states into federal school choice tax credit program: https://news.ballotpedia.org/2026/04/10/kansas-and-wisconsin-governors-veto-bills-opting-their-states-into-federal-school-choice-tax-credit-program/ - Wisconsin AB 602 (2025-2026 Regular Session) on LegiScan: https://legiscan.com/WI/bill/AB602/2025 Canonical: https://eftccredit.com/news/wisconsin-governor-evers-vetoes-fstc-opt-in-march-2026 ### Education Secretary McMahon visits Hamtramck charter school to press Whitmer to opt Michigan into §25F Date: 2026-03-27. Category: state-action. State: MI. On March 27, 2026, U.S. Secretary of Education Linda McMahon traveled to Hamtramck Academy, a charter school of roughly 550 students in Hamtramck, Michigan, to publicly press Democratic Governor Gretchen Whitmer to opt the state into the federal Education Freedom Tax Credit (§25F). The program, which becomes available January 1, 2027, lets taxpayers claim a dollar-for-dollar federal credit of up to $1,700 per taxpayer for donations to qualified Scholarship Granting Organizations, with scholarships flowing to households earning up to 300% of area median gross income and usable across public, private, religious, and homeschool options. McMahon was joined by Republican Michigan House Speaker Matt Hall (R-Richland Township) and several Republican state legislators, including Tim Kelly, Matt Maddock, Alicia St. Germaine, Joseph Pavlov, and Mike Harris. Importantly, this was a federal-official advocacy visit, not a state action: Michigan has not opted in, and no signing, executive order, statute, or IRS advance election occurred. The mechanism McMahon emphasized is the one that makes §25F a state-by-state contest. The credit is federal, but it only functions in states whose governors (or legislatures) make an advance election to participate, after which qualified SGOs in that state can receive credit-eligible donations and award scholarships. McMahon's central warning was about that geography of money: if Michigan does not opt in, donations from Michigan taxpayers would not stay home but would instead flow to SGOs in states that have already joined, funding scholarships for families elsewhere. She asserted that 27 states had already opted in as of late March, a figure that is her own characterization rather than a confirmed IRS or Treasury count, and one worth treating as an attributed claim until the federal government publishes an [official list of participating states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). The credit cap of $1,700 applies per donor on the federal credit, not as a ceiling on what any single scholarship can be worth. Whitmer's office did not move. It held to an awaiting-federal-guidance posture, having previously described the program as a "high-level talking point" that needed more information before the state could evaluate it. That cautious stance places Michigan among the Democratic-led states still weighing whether to participate, a split we track in our coverage of how [Democratic governors are dividing on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). It stands in contrast to early movers like Virginia, where [Glenn Youngkin made his state the first to opt in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), and to [New York under Gov. Kathy Hochul](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026). Three days later, on March 30, Speaker Hall publicly renewed the call, framing participation as a literacy and educational-support benefit for Michigan families and repeating the warning that the state would forfeit tax benefits to other states by sitting out. For donors and prospective SGO founders, the practical takeaway is that Michigan remains a non-participating state for now, which means Michigan taxpayers cannot yet route §25F-eligible donations to in-state organizations. Michigan's current status, and every other state's, is tracked on our [Michigan state page](https://eftccredit.com/states/michigan) and the [national participation map](https://eftccredit.com/states). Operators thinking about standing up one of Michigan's first SGOs (so the infrastructure exists if and when the state elects in) can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current landscape in the [SGO directory](https://eftccredit.com/sgos); the back-office work of intake, eligibility checks, and scholarship disbursement can be run on software built specifically for §25F. The forward question is whether sustained federal and legislative pressure changes Whitmer's calculus before the 2027 launch. With the program opening January 1, 2027 and a 2026 election cycle in between, Michigan's decision could fall to either the current administration or its successor, and the longer the state waits, the longer Michigan donors will have credit-eligible dollars with nowhere in-state to send them. Whether McMahon's visit marks the start of a real opt-in push or a one-day photo opportunity will be measured by whether Michigan ever files an advance election with the IRS. Sources: - Chalkbeat Detroit: Michigan education secretary Linda McMahon promotes federal tax scholarship (Mar. 27, 2026): https://www.chalkbeat.org/detroit/2026/03/27/michigan-education-secretary-linda-mcmahon-promotes-federal-tax-scholarship/ - WNEM: Speaker Hall urges Whitmer to join federal education tax credit program (Mar. 30, 2026): https://www.wnem.com/2026/03/30/speaker-hall-urges-whitmer-join-federal-education-tax-credit-program/ - The Detroit News: Whitmer urged by Trump education secretary McMahon to join K-12 tax credit plan (Mar. 27, 2026): https://www.detroitnews.com/story/news/politics/2026/03/27/gov-gretchen-whitmer-urged-trump-education-secretary-linda-mcmahon-join-k-12-tax-credit-plan/89330986007/ - Michigan Advance: U.S. Education Secretary McMahon says Michigan should join Trump's school tax credit plan (Mar. 27, 2026): https://michiganadvance.com/2026/03/27/u-s-education-secretary-mcmahon-says-michigan-should-join-trumps-school-tax-credit-plan/ - CBS News Detroit: Will Michigan join the Education Freedom Tax Credit? McMahon visits Hamtramck (Mar. 27, 2026): https://www.cbsnews.com/detroit/news/education-fredom-tax-credit-mcmahon-hamtramck/ Canonical: https://eftccredit.com/news/mcmahon-presses-whitmer-michigan-opt-in-25f-march-2026 ### Minnesota Gov. Walz declines to opt Minnesota into the Federal Scholarship Tax Credit Date: 2026-03-24. Category: state-action. State: MN. [Minnesota](https://eftccredit.com/states/minnesota) Governor Tim Walz said on March 24, 2026 that opting Minnesota into the federal Scholarship Tax Credit (FSTC) is "never going to happen." FSTC is the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. Without an opt-in, Minnesota will not designate [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide), and Minnesota families will not be eligible for FSTC scholarships when the program goes live on January 1, 2027. Walz's stance has been controversial in part because of how he framed it in earlier budget work. His supplemental budget proposal earlier in the 2026 session would have ended Minnesota's longstanding state nonpublic pupil aid and pupil transportation aid programs if Minnesota opted into the federal credit, an unusual structure given that the federal opt-in itself imposes no fiscal cost on the state. Critics pointed out that the federal credit redirects federal income tax that would otherwise go to the U.S. Treasury, rather than drawing down state revenue. For Minnesota donors and families, the practical effect is the same as in other declined or vetoed states: Minnesota residents can still claim the federal §25F credit (up to $1,700 per taxpayer) by donating to SGOs in opted-in states, but those scholarships will fund K-12 students in other states rather than in Minnesota. Eligible students under §25F are those in households at or below 300% of the relevant Area Median Gross Income. The FSTC opt-in is annual. Each participating state's governor must submit a list of qualifying SGOs to the U.S. Treasury by January 1 of each participating year, so Minnesota's status could change in a future year under the same governor or a successor. As of May 2026, with New York's announcement, roughly 30 states have moved toward participation, leaving Minnesota as one of a small group of states that have explicitly declined. Sources: - MPR News: 'Never going to happen', Walz says he won't opt Minn. into federal tax change: https://www.mprnews.org/story/2026/03/24/walz-wont-opt-minnesota-into-federal-education-tax-change - MPR News: Proposed federal tax credit risks hanging up education debate at MN Capitol: https://www.mprnews.org/story/2026/03/11/proposed-federal-tax-credit-risks-hanging-up-education-debate-at-mn-capitol - American Experiment: New York joins federal tax-credit scholarship, Minnesota becomes stark outlier: https://www.americanexperiment.org/new-york-joins-federal-tax-credit-scholarship-minnesota-becomes-stark-outlier - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/minnesota-governor-walz-declines-fstc-march-2026 ### Idaho writes its §25F opt-in into permanent statute: HB 731 takes effect July 1, 2026 Date: 2026-03-19. Category: state-action. State: ID. Idaho has done something no other state had done at the time of writing: it opted into the federal Scholarship Tax Credit (FSTC / ECCA / §25F) by executive order, then turned around and locked that choice into permanent statute. House Bill 731, titled "EDUCATION - Adds to existing law to provide for the State of Idaho to elect to participate in the federal tax credit scholarship program," was signed by Governor Brad Little on March 19, 2026 as Session Law Chapter 72, and its effective date is July 1, 2026. The statute makes Idaho's participation a fixture of state law rather than a policy that survives only as long as a governor's signature on an executive order, and it lands just as the program prepares for its January 1, 2027 launch and its $1,700 donor credit cap. The vote totals are the headline. The Idaho House passed HB 731 on February 24, 2026 by a margin of 68-0-2, and the Senate followed on March 12, 2026 by 30-5-0. Outside of the handful of senators recorded against it, the bill drew essentially no organized opposition, a striking contrast to the bitter, party-line fights and veto showdowns that have defined §25F adoption in other states. The codification was deliberate: HB 731 was written to make participation permanent precisely because an executive order can expire, while a statute remains on the books until the legislature repeals it. For a program that depends on a state's standing election to the U.S. Treasury, that durability matters to the donors and Scholarship Granting Organizations deciding whether Idaho is a stable place to build. HB 731 did not start the clock; it secured it. Idaho's path began earlier in the year when Governor Little issued Executive Order 2026-03 on February 16, 2026, opting the state into the federal scholarship tax credit program created under the One Big Beautiful Bill Act and directing the Idaho State Department of Education to implement it. The legislature then converted that executive action into law over the following month. The statute itself addresses how Idaho carries out its election, including the state's coordination with the U.S. Treasury and the handling of qualified scholarship organizations operating in Idaho, though the precise operational mechanics will be settled as the State Department of Education stands up the program ahead of the 2027 launch. The earlier [IRS Form 15714 advance-election process](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025) gave states a way to signal participation before the rules were final; Idaho has now gone considerably further than a preliminary signal. What Idaho documents is a fourth distinct route into §25F. Virginia and Florida came in by governor's pen alone. [Kentucky, Kansas, and North Carolina arrived through legislative veto overrides](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026), forcing the program in over a hostile governor's objection. Idaho inverts that sequence entirely: a Republican governor opted in by executive order, and then a near-unanimous, bipartisan legislature codified the choice into permanent statute, removing any future dependence on the executive's continued cooperation. The timing is also notable, because the July 1 effective date arrives just as Treasury's previewed proposed §25F regulations, expected by the end of September 2026, begin to set the national implementation calendar. We track Idaho's standing and every other state's on the [Idaho state page](https://eftccredit.com/states/idaho) and the [participation map](https://eftccredit.com/states); founders weighing where to organize can review our [directory of scholarship-granting organizations](https://eftccredit.com/sgos) and the [primer on how §25F works](https://eftccredit.com/learn). Sources: - Idaho State Legislature: House Bill 731 (2026) full status history: https://legislature.idaho.gov/sessioninfo/2026/legislation/H0731/ - Office of the Governor: Gov. Little executive order opting Idaho into the federal scholarship tax credit program (EO 2026-03): https://gov.idaho.gov/pressrelease/gov-little-expands-education-freedom-issues-executive-order-opting-into-federal-scholarship-tax-credit-program/ - Idaho Freedom: House Bill 731 analysis (federal scholarship opt-in): https://idahofreedom.org/house-bill-731-federal-scholarship-opt-in-0/ Canonical: https://eftccredit.com/news/idaho-hb-731-codifies-25f-opt-in-march-2026 ### A New Jersey bill would order the state into §25F outright: A4777 turns the opt-in from a governor's choice into a statutory mandate Date: 2026-03-19. Category: state-action. State: NJ. New Jersey has not joined the federal Education Freedom Tax Credit (FSTC / ECCA / §25F), and its governor has not said whether it will. A bill introduced in the Assembly on March 19, 2026 would settle the question by statute rather than wait for the governor to decide. A4777, sponsored by Assemblymen Michael Inganamort and Gerry Scharfenberger and Assemblywoman Dawn Fantasia, is titled "An Act requiring the State to participate in the federal tax credit program for individual contributions to scholarship granting organizations." Its operative language is blunt: "The State of New Jersey shall participate" in the §25F program for all taxable years beginning after December 31, 2026, and the Commissioner of Education "shall annually provide" the U.S. Secretary of the Treasury the information federal law requires, including a roster of eligible Scholarship Granting Organizations (SGOs) operating in the state. That is a stronger instrument than the pressure measures other states have used. Where California's [ACR-229](https://eftccredit.com/news/california-acr229-hoover-urges-newsom-opt-in-25f-june-2026) and Washington's [HJM 4013](https://eftccredit.com/news/washington-hjm-4013-urges-ferguson-opt-in-25f-january-2026) are non-binding resolutions that merely urge a governor to act, A4777 is a substantive bill that would place an affirmative duty to participate directly into New Jersey statute and assign the administrative job to the Department of Education. The catch is arithmetic: its three sponsors are Republicans in a Legislature that Democrats control, and the bill was referred to committee, where measures without majority support routinely sit without a hearing. As a practical matter it is unlikely to reach the floor this session. What it does accomplish is to convert New Jersey's opt-in question from an abstraction into concrete statutory text, on the record, with a specific mechanism attached. New Jersey's actual status is unchanged. Gov. Mikie Sherrill, who took office in January 2026, has been [noncommittal, saying the state will evaluate the program](https://eftccredit.com/news/new-jersey-sherrill-noncommittal-25f-evaluate-may-2026), and New Jersey has neither filed the IRS advance election (Form 15714) nor submitted a list of Scholarship Granting Organizations. The opt-in decision is annual, so nothing about this bill's likely stall forecloses a later yes: a governor who does not act for 2027 can still elect in for 2028 or any subsequent year. But for now New Jersey sits among the pending states, and every year it stays out, its residents' credit-eligible dollars flow to SGOs in states that have opted in rather than to children at home. The stakes in New Jersey are unusually large because of who the credit would reach. The state has one of the country's biggest nonpublic-school enrollments, heavily Catholic and independent, precisely the low- and middle-income families §25F is built around (eligibility runs to households at or below 300% of area median income). That is the same argument that has moved governors of both parties elsewhere: §25F does not spend New Jersey's own money. It lets New Jersey taxpayers redirect federal tax they would otherwise owe into scholarships for local students, which reframes the decision as less an ideological stance than a choice about whether to leave a large sum unclaimed. Where the broader field of Democratic governors has landed is tracked in our coverage of how [Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). For anyone weighing whether to build a New Jersey SGO, A4777 is a signal rather than a green light: it shows the opt-in has legislative backers even if the votes are not there yet, while the actual decision still rests with a governor who has not tipped her hand. New Jersey's scale is the reason to be ready rather than to wait, because if the state ever files its election the demand for scholarship capacity would be substantial from day one. Founders can track New Jersey's status and every other state's on our [New Jersey state page](https://eftccredit.com/states/new-jersey) and the [national participation map](https://eftccredit.com/states), see the field already forming in the [SGO directory](https://eftccredit.com/sgos), and use our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) to build the pieces that do not depend on any one governor's decision. Sources: - New Jersey Legislature: A4777, An Act requiring the State to participate in the federal tax credit program for contributions to scholarship granting organizations (introduced March 19, 2026): https://pub.njleg.gov/Bills/2026/A5000/4777_I1.HTM - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/new-jersey-a4777-inganamort-requires-25f-participation-march-2026 ### Hawaii lawmakers press Gov. Green to reverse course: four resolutions urge him to reconsider declining §25F Date: 2026-03-19. Category: state-action. State: HI. Hawaii is one of a small group of states whose governor has said no to the federal Education Freedom Tax Credit (FSTC / ECCA / §25F), and in March 2026 its own legislature pushed back. Between March 12 and March 19, lawmakers introduced four measures carrying the same title, "Urging the Governor to Reconsider His Decision Not to Allow Hawaii to Participate in the Federal Education Freedom Tax Credit Program." Two came from the House (HR68 and HCR74) and two from the Senate (SR148 and SCR158). The House measures were referred to the Education and Finance committees, the Senate measures to Education and Ways and Means. Their shared premise is stated in the title: Gov. Josh Green had already decided against making Hawaii's advance election, and a bloc of legislators wanted that decision revisited before the program's January 1, 2027 launch. It is worth being precise about what these resolutions are and are not. A resolution expresses the will of one or both chambers; it does not change law and cannot compel the governor to file anything. As of their last action all four had been referred to committee, the earliest stage, and none carried the force of a statute directing an opt-in. What they accomplish, regardless of whether they advance, is to put Hawaii's opt-in question on the official legislative record and to signal that the governor's "no" is contested inside his own party's legislature rather than settled. Hawaii's status on the map is unchanged by the resolutions themselves: Green declined to make the 2027 advance election, and the state has not filed Form 15714 or submitted a list of Scholarship Granting Organizations to Treasury. But the decision is not permanent. The §25F election is annual, so a governor who declines for 2027 can still elect in for 2028 or any later year. Hawaii is not alone in this posture; we have tracked how Hawaii, New Mexico, and Oregon have all been [reported to be reconsidering](https://eftccredit.com/news/declined-states-reconsidering-hawaii-new-mexico-oregon-may-2026), and where the broader field of Democratic governors has landed in our look at how [Democratic governors have split on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). The through-line is the argument that has moved governors across the spectrum: §25F does not spend a state's own money, it lets residents redirect federal tax they would otherwise owe into scholarships for local children. For anyone weighing whether to build a Hawaii SGO, the practical signal is that the opt-in question is live rather than closed, even with the governor's position unmoved for now. Nothing about these resolutions changes what an operator can do today, and almost everything an SGO needs, its 501(c)(3) determination, a segregated account, a donor pipeline, can be assembled independent of any one governor's decision. Founders can track Hawaii's status and every other state's on our [Hawaii state page](https://eftccredit.com/states/hawaii) and the [national participation map](https://eftccredit.com/states), see the field already forming in the [SGO directory](https://eftccredit.com/sgos), and use our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) to build the pieces that do not depend on the statehouse. If Hawaii ever files its election, the operators who prepared during the wait are the ones ready to serve families on day one. Sources: - Hawaii State Legislature: HR68, Urging the Governor to Reconsider His Decision Not to Allow Hawaii to Participate in the Federal Education Freedom Tax Credit Program (2026): https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HR&billnumber=68&year=2026 - Hawaii State Legislature: HCR74 (companion House concurrent resolution, 2026): https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HCR&billnumber=74&year=2026 - Hawaii State Legislature: SR148 (Senate resolution, 2026): https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SR&billnumber=148&year=2026 - Hawaii State Legislature: SCR158 (Senate concurrent resolution, 2026): https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SCR&billnumber=158&year=2026 - 26 U.S.C. §25F (federal Education Freedom Tax Credit): https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/hawaii-legislature-urges-green-reconsider-25f-march-2026 ### Kentucky legislature overrides Gov. Beshear's veto of FSTC opt-in bill Date: 2026-03-17. Category: state-action. State: KY. On March 17, 2026, the [Kentucky](https://eftccredit.com/states/kentucky) legislature completed its override of Governor Andy Beshear's veto of HB 1, the state's bill to opt in to the Federal Scholarship Tax Credit (FSTC) program. Beshear vetoed the bill on March 13; the House overrode him 77-14 on March 16 and the Senate followed 31-5 on March 17, the day the act was delivered to the Secretary of State. The override means Kentucky will participate in the FSTC, the federal program known as the Educational Choice for Children Act (ECCA) and codified at IRC §25F, beginning when the program launches on January 1, 2027. Kentucky's path to participation is unusual: most opt-in states have either had governors actively support the program or had governors and legislatures aligned. Kentucky is one of a handful of states where the legislature affirmatively forced participation against the governor's wishes through a supermajority override. For Kentucky families, the practical effect is the same as in any other opted-in state: families at or below 300% of Area Median Gross Income will be eligible to apply for scholarships through state-designated [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) once the program goes live in 2027. Whether Kentucky stays opted in long-term depends on future legislative cycles and gubernatorial decisions. The FSTC opt-in is annual; participation must be re-certified each January 1 by submitting an SGO list to the U.S. Treasury. Sources: - Ballotpedia News: Kansas and Wisconsin governors veto bills opting their states into federal school choice tax credit program (also covers Kentucky override): https://news.ballotpedia.org/2026/04/10/kansas-and-wisconsin-governors-veto-bills-opting-their-states-into-federal-school-choice-tax-credit-program/ - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ Canonical: https://eftccredit.com/news/kentucky-legislature-overrides-beshear-veto-march-2026 ### In Kentucky, the official who decides which SGOs qualify is not the governor. It is the Secretary of State. Date: 2026-03-17. Category: state-action. State: KY. When a state joins the federal Education Freedom Tax Credit (FSTC / ECCA / §25F), someone inside state government has to run it: file the advance election with the U.S. Treasury, certify which Scholarship Granting Organizations (SGOs) qualify, submit that list to the IRS, and keep it current every year. In most states that job sits with the governor or the department of revenue. Kentucky put it somewhere unusual. House Bill 1, the 2026 act that opted Kentucky in, assigns the entire function to the Secretary of State, currently Michael Adams, and it codifies the program inside KRS Chapter 14, the chapter that governs the Secretary of State's office. For any organization that wants to operate as a Kentucky SGO, that is the single most important administrative fact about the state: the office you answer to is not the one most people would guess. The choice was structural, not incidental, and the veto fight explains it. Kentucky reached §25F the hard way, over Gov. Andy Beshear's objection: Beshear vetoed HB 1 on March 13, 2026, the House overrode him on March 16, and the Senate completed the [veto override](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026) on March 17, making the bill law that day. A legislature that has just forced a program past a hostile governor has an obvious problem, the same governor's executive branch would normally administer it. Routing the annual election and the SGO list through the independently elected Secretary of State, rather than a department the governor controls, is the legislature's answer: it insulates Kentucky's participation from a chief executive who fought it, and removes any future governor's ability to quietly stall the paperwork the law now requires. The statute is specific about what the office must do. The Secretary of State is the sole official authorized to report Kentucky's election to the U.S. Secretary of the Treasury and to submit the state's list of qualifying SGOs, and the list must go to Treasury by January 1 of each year. The office is directed to publish administrative regulations and guidance on a website, is empowered to promulgate those regulations, and may collect a fee from SGOs (and accept private contributions) to cover the program's costs. That fee, set by regulation rather than fixed in the statute, is the one distinctly Kentucky requirement an SGO should budget for; beyond it, the enacted law layers nothing onto the federal §25F eligibility rules. For anyone building an SGO, this is the practical scaffolding the whole program runs on, and Kentucky is a useful illustration of a question every participating state has to answer: which officer owns the list. It is the same question [West Virginia left unresolved when HB 4588 stalled](https://eftccredit.com/news/west-virginia-hb-4588-treasurer-25f-stalls-conference-march-2026) and the state adjourned without designating an administrator. Kentucky answered it cleanly and early, and named an office structurally shielded from the governor. Operators eyeing Kentucky should plan around the Secretary of State's forthcoming regulations and administrative fee, and watch that office, not the governor's, for the application process. Update: on July 22, 2026, Secretary of State Adams did exactly that, [completing Kentucky's federal election and filing the regulation that opens the SGO declaration process](https://eftccredit.com/news/kentucky-adams-files-federal-25f-opens-sgo-declaration-july-2026). One caveat keeps Kentucky in the same boat as everyone else on timing: naming the administrator is not the same as opening the door. As of mid-2026 no state, Kentucky included, has actually opened SGO certification, because the mechanics are gated on Treasury's proposed regulations expected at the end of September, a hold we cover in [our piece on why SGO certification has not opened anywhere](https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026). What Kentucky has settled is the who and the where; the when still runs on the federal clock. Kentucky's status is tracked on our [Kentucky state page](https://eftccredit.com/states/kentucky) and the [national participation map](https://eftccredit.com/states), and founders weighing a Kentucky program can start with our [guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo) and the [SGO directory](https://eftccredit.com/sgos). Sources: - Kentucky Legislative Research Commission: HB 1 (2026 RS) bill record and summary: https://apps.legislature.ky.gov/record/26RS/hb1.html - Kentucky Acts Chapter 4 (2026 RS): enacted text of HB 1 (Secretary of State submits the SGO list and collects an administrative fee; no in-state office mandate in the enacted law): https://apps.legislature.ky.gov/law/acts/26RS/documents/0004.pdf Canonical: https://eftccredit.com/news/kentucky-sgo-registry-secretary-of-state-adams-hb1-march-2026 ### West Virginia's HB 4588 would put the State Treasurer in charge of §25F: it passed both chambers, then stalled in conference Date: 2026-03-14. Category: state-action. State: WV. West Virginia came within one procedural step of designating the office that would carry out the federal Scholarship Tax Credit (FSTC / ECCA / §25F) inside the state, and then ran out of clock. House Bill 4588, titled "relating to participating in the federal tax credit scholarship program," adds a new Article 31A, "The Federal Tax Credit Scholarship Program," to Chapter 18 of the state code (sections 18-31A-1 through 18-31A-6). Lead sponsor Del. Adam Burkhammer (R-District 64) and his co-sponsors wrote the bill to direct the West Virginia State Treasurer to participate in the federal credit established under section 70411 of Public Law No. 119-21, the §25F provision enacted in the One Big Beautiful Bill Act. The House passed it on March 4, 2026 (Roll No. 288) and the Senate passed it on March 13, 2026 (Roll No. 539), but the two chambers split over the Senate's amendments, and the bill went to a conference committee on March 14, the session's sine die adjournment date, with no recorded final passage or signature. The mechanism HB 4588 sets up is administrative, not fiscal. Rather than creating a state tax credit or making a discretionary opt-in election, the bill designates the State Treasurer as the office responsible for the program: under section 18-31A-1, the Treasurer would participate in the federal credit under section 70411, accept applications from scholarship granting organizations on a year-round basis, and by December 1 of each year submit to the U.S. Secretary of the Treasury and publish on the Treasurer's website a list of qualified SGOs and schools. The bill text itself never uses the label "§25F" or cites the $1,700 donor credit cap; those are the federal framing around the program it points to. What West Virginia was deciding here was which state officer maintains the qualified-SGO list that Treasury relies on, a question of plumbing that determines how smoothly donors and organizations can actually use the credit once it launches on January 1, 2027. For SGOs and donors, that designation question is not academic. The federal program runs on each state's list of qualified scholarship granting organizations, and an organization cannot receive credit-eligible donations in a state until it appears on the list that state submits to Treasury. HB 4588 would have given West Virginia a clear owner for that process, the Treasurer's office, with a year-round application window and a fixed December 1 publication deadline, so operators would know exactly where to apply and when the roster is finalized. Founders weighing whether to organize in West Virginia can track the state's status on our [West Virginia state page](https://eftccredit.com/states/west-virginia) and against the national [participation map](https://eftccredit.com/states), review who is already operating in our [directory of scholarship granting organizations](https://eftccredit.com/sgos), and start with the [primer on how §25F works](https://eftccredit.com/learn). Operators who do clear a state list still need to run the program day to day, and §25F-native software handles the donor receipts, allocation, and reporting the credit requires. A note of caution on the margins: the official action history confirms the roll-call numbers and that both chambers passed the bill, and contemporaneous accounts described unanimous votes (93-0 in the House, 33-0 in the Senate), but those numeric tallies should be read against the roll-call sheets before being treated as settled. What is not in doubt is how the bill died. On March 14 the House refused to concur in the Senate amendments, and the measure went to conference, with Senators Rucker, Roberts, and Woelfel and Delegates Criss, Gearheart, and Williams named as conferees, before the session adjourned without a final vote. A Senate companion, SB 644 from Sen. Patricia Rucker (R-District 16), carried identical State Treasurer, section 70411, and December 1 language and met the same end. It is worth being precise about what HB 4588's failure did and did not do, because West Virginia's participation in the federal credit does not actually hinge on this bill. The state made the advance election separately, by executive action, and West Virginia appears on the IRS's [official list of states that have elected in](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). What HB 4588 would have settled is narrower but still consequential: which state officer owns and publishes the qualified-SGO list once the program runs. Virginia and Florida opted in by a governor's pen, and [Kentucky, Kansas, and North Carolina forced the program through over their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026); West Virginia is in, but it adjourned without designating the Treasurer, or any office, as the administrator of its SGO roster. That single-officer, annual-cycle structure is the kind of administrative scaffolding nearly every participating state will need, so expect West Virginia lawmakers to bring the Treasurer-designation language back when they reconvene. We will track it on the [West Virginia page](https://eftccredit.com/states/west-virginia) when they do. Sources: - WV HB 4588 (2026 RS) introduced bill text PDF: https://www.wvlegislature.gov/Bill_Text_HTML/2026_SESSIONS/RS/bills/hb4588%20intr.pdf - WV HB 4588 (2026 RS) bill status / action history: https://www.wvlegislature.gov/Bill_Status/bills_history.cfm?year=2026&sessiontype=RS&input=4588 - WV SB 644 (2026 RS) companion bill text: http://www.wvlegislature.gov/Bill_Status/bills_text.cfm?billdoc=sb644+intr.htm&yr=2026&sesstype=RS&i=644 - Adam Burkhammer (R-District 64) - Ballotpedia: https://ballotpedia.org/Adam_Burkhammer - Patricia Rucker (R-District 16) - Ballotpedia: https://ballotpedia.org/Patricia_Rucker Canonical: https://eftccredit.com/news/west-virginia-hb-4588-treasurer-25f-stalls-conference-march-2026 ### California students mount a “Purple Postcard” campaign pressing Newsom to opt into the federal §25F scholarship credit Date: 2026-02-11. Category: state-action. State: CA. A grassroots campaign out of a Los Angeles parish school is testing whether the federal Scholarship Tax Credit (FSTC / ECCA / §25F) can find Democratic constituencies in a state whose leaders have not embraced it. On February 11, 2026, St. Genevieve Parish Schools in Panorama City announced a "Purple Postcard Campaign" in which more than 1,100 students are distributing roughly 15,000 postcards encouraging Californians to contact Governor Gavin Newsom and ask him to opt the state into the program. The organizers tied the campaign to the birthday of labor organizer Cesar Chavez and framed its mass mailing of signed postcards as honoring his legacy of peaceful advocacy. The purple of the postcards is a deliberate nod to the United Farm Workers' colors, signaling that the effort is pitched from the left rather than the school-choice right that usually carries this issue. What makes the effort notable is the coalition behind it. The campaign cites Democrats for Education Reform, whose CEO is former Providence mayor Jorge Elorza, and the California Catholic Conference, represented by Samara Palko, as partners, and it is advised by Sister Erin Zubal, Chief of Staff at the Catholic social-justice lobby NETWORK. Seton Hill University is offering participating students three college credits for the civics work. That lineup, a Democratic-aligned reform group, the state's Catholic bishops, and a progressive religious lobby, is an unusual one to be pressing a Democratic governor to join a program that most Democratic governors have so far rejected or restricted. It reframes §25F not as a partisan voucher fight but as a funding question for low- and middle-income families who already attend faith-based and independent schools, the constituency St. Genevieve serves in the San Fernando Valley. The stakes the students are invoking are real but prospective. The §25F credit, enacted in 2025, takes effect January 1, 2027 and lets individual donors claim a dollar-for-dollar federal credit of up to $1,700 for gifts to qualifying Scholarship Granting Organizations, but only in states that affirmatively opt in by filing IRS Form 15714 and submitting a list of approved SGOs. Because the scholarships are funded by donors rather than the state treasury, a state that stays out simply forecloses its own residents from the credit while donors elsewhere can claim it. That is the "billions hanging in the balance" argument the campaign leans on. We explain the opt-in mechanics and the donor credit in our [learn library](https://eftccredit.com/learn), and the running tally of which states are in, out, or undecided lives on the [state participation map](https://eftccredit.com/states). As of June 2026, California remains undecided. Governor Newsom has issued no public position on §25F, no bill to opt the state in or to authorize an SGO list has advanced in the 2025-2026 legislative session, and California has neither filed Form 15714 nor submitted a list of Scholarship Granting Organizations. (Republican Rep. Vince Fong separately urged Newsom to opt in, in a letter dated January 29, 2026 and posted to his official congressional office page.) The Purple Postcard Campaign is therefore a data point about advocacy pressure rather than a change in California's status, and it sits alongside the broader pattern we track in [where Democratic governors have landed](https://eftccredit.com/news/democratic-governors-split-on-25f-2026) and the choices facing [other still-pending states](https://eftccredit.com/news/pending-states-whats-at-stake-pennsylvania-may-2026). For founders weighing whether to stand up a California SGO ahead of a possible opt-in, the [California state page](https://eftccredit.com/states/california) and our [SGO directory](https://eftccredit.com/sgos) are the places to watch. Whether the campaign moves Sacramento is unknowable today, but it does establish that the constituency for §25F in California is not confined to the usual school-choice advocates: a governor weighing the decision will hear from Catholic families, a reform-minded Democratic group, and a progressive religious lobby, not only from the program's conservative architects. Update, June 2026: the campaign escalated through the spring rather than ending in March. St. Genevieve students brought their postcards to the California State Capitol in Sacramento on March 25, 2026, and later met with Brooks Allen, Gov. Newsom's education policy advisor, who encouraged them to keep campaigning while the administration continues studying the issue. The signature mass mailing came on May 19, 2026, when participants formed a roughly mile-long human chain to send some 15,000 signed postcards from the Panorama City post office. As of late June 2026, California still has not opted in: Newsom has taken no public position and filed no advance election. Sources: - PR Newswire: Students Lead California Effort as Billions in Federal Scholarship Funds Hang in the Balance (Feb. 11, 2026): https://www.prnewswire.com/news-releases/students-lead-california-effort-as-billions-in-federal-scholarship-funds-hang-in-the-balance-302684646.html - Asian Journal: St. Genevieve students launch Christmas card campaign urging Newsom to say yes to federal scholarship program (Dec. 2025): https://asianjournal.com/usa/california/st-genevieve-students-launch-christmas-card-campaign-urging-newsom-to-say-yes-to-federal-scholarship-program/ Canonical: https://eftccredit.com/news/california-purple-postcard-campaign-newsom-25f-february-2026 ### Ohio Opts In: DeWine Puts the State Onto the Federal §25F Scholarship Tax Credit Date: 2026-02-04. Category: state-action. State: OH. Ohio has opted into the federal §25F Education Freedom Tax Credit, with Republican Gov. Mike DeWine signing the state onto the program in early February 2026. The move lets Ohio taxpayers claim a federal tax credit of up to $1,700 for donations to qualified scholarship granting organizations (SGOs), with the credit becoming available for the 2027 tax year beginning January 1, 2027. The Ohio Attorney General's charitable-law office now states the position plainly on its certification page: "Ohio has opted to be a covered state for the federal scholarship granting organization program." Ohio's participation was subsequently confirmed by the IRS, which named the state among the 27 jurisdictions that had made an advance election in its [official list released June 8, 2026](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). The mechanism here matters, and it is worth describing precisely. Ohio did not enact a separate state statute or sign an executive order to join. Instead, the state made an advance election to participate by filing IRS Form 15714, the executive election that a governor (or a governor's designated official) uses to opt a state in. This is the same administrative path the IRS laid out when it published [Form 15714 in December 2025](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025), and the same route taken by states such as [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026) and [Alaska](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026). The Defense of Freedom Institute's participation tracker records Ohio as having "made an advance election to participate under Section 25F for 2027," consistent with both the IRS list and the Attorney General's covered-state language. Because the election is an executive filing rather than legislation, no floor vote or veto fight was required, unlike the contested paths in Kentucky, Kansas, and North Carolina. For Ohio donors and the families they support, the practical effect is straightforward: starting in 2027, a contribution to a qualified Ohio SGO can be offset dollar-for-dollar by a federal credit worth up to $1,700 per taxpayer. The credit is capped at $1,700, a figure the §25F statute itself already settles, as we explain in our breakdown of [why the cap is $1,700 and not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). The covered-state designation also turns on the Attorney General's charitable division, which handles SGO certification in Ohio, so organizations that want to receive §25F donations will need to clear that certification process. Ohio's status, certification details, and the broader national picture are tracked on our [Ohio state page](https://eftccredit.com/states/ohio) and the [national participation map](https://eftccredit.com/states). The opt-in opens a runway for SGOs to organize before the program goes live. With nearly a year between the election and the January 1, 2027 launch, founders weighing whether to establish a qualified Ohio SGO have time to build the infrastructure needed to accept donations, verify eligibility, and award scholarships. How the credit works, who can found an SGO, and what certification entails are covered in our [explainers](https://eftccredit.com/learn), and existing organizations are listed in the [SGO directory](https://eftccredit.com/sgos). Operators standing up a new Ohio program do not have to build the donation, compliance, and scholarship-tracking machinery from scratch: there is software built specifically for the §25F workflow, which can shorten the path from a covered-state election to a functioning program. Ohio now joins a growing roster of states that have elected in ahead of the 2027 launch, a list that has expanded steadily from early movers like [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) through the more than two dozen states the IRS confirmed by June. For Ohio families, the question shifts from whether the credit will be available to how quickly the state's SGO network takes shape, and that buildout is the part worth watching between now and the first day donations can be claimed. Sources: - IRS: More than half of US states signed up to participate in the federal scholarship tax credit program (Ohio listed, IR-2026-76): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Ohio Attorney General Charitable Law: Scholarship Granting Organization Certification (confirms covered-state status): https://charitable.ohioago.gov/Scholarship-Granting-Organization-Certification - Defense of Freedom Institute: Education Freedom Tax Credit state participation tracker: https://dfipolicy.org/education-freedom-tax-credit/ Canonical: https://eftccredit.com/news/ohio-dewine-advance-election-25f-opt-in-february-2026 ### New Hampshire opts into the Federal Scholarship Tax Credit under Gov. Ayotte Date: 2026-01-29. Category: state-action. State: NH. New Hampshire opted into the Federal Scholarship Tax Credit (FSTC), also known as the Educational Choice for Children Act (ECCA) and codified at IRC §25F, on January 29, 2026. The move came by executive action during National School Choice Week, with Governor Kelly Ayotte and the New Hampshire Department of Education announcing that the state would participate and begin identifying the qualifying Scholarship Granting Organizations (SGOs) that will award federally funded K-12 scholarships once the program launches on January 1, 2027. The mechanics are the same everywhere: a state opts in when it files the IRS advance election (Form 15714) designating its participation, after which donors anywhere in the country can claim a dollar-for-dollar federal income tax credit of up to $1,700 for contributions to a qualifying SGO, which awards scholarships to families earning up to 300% of their area median gross income. New Hampshire moved early, joining Virginia, Nevada, and Florida in a January cluster of states that committed before the program's operational details were even fully drawn, a signal that the state did not intend to wait on Treasury's forthcoming regulations to make its intentions clear. The legislature then moved to put the state's participation on a statutory footing. HB 1774, which directs the Department of Revenue Administration to administer the individual credit for contributions to qualified SGOs and tasks the Department of Education with maintaining the approved-SGO list for tax years ending after December 31, 2026, cleared both chambers in late May 2026. Codifying participation this way matters for operators and donors: it puts the state's involvement beyond a single administration's discretion and gives prospective SGO founders a clearer framework to build against. For families, donors, and prospective SGO founders in New Hampshire, the practical takeaway is that the state is firmly in the participating column and the work now shifts to standing up the SGO infrastructure ahead of the 2027 launch. New Hampshire's status, and every other state's, is tracked on our [New Hampshire state page](https://eftccredit.com/states/new-hampshire) and the [national participation map](https://eftccredit.com/states); anyone weighing whether to launch an organization can start with our guide on [how to start an SGO](https://eftccredit.com/learn/how-to-start-an-sgo). Sources: - New Hampshire Department of Education: New Hampshire opts into federal education tax credit program: https://www.education.nh.gov/news-and-media/new-hampshire-opts-federal-education-tax-credit-program-scholarship-granting-organizations - Concord Monitor: New Hampshire opts into federal education scholarship program (Jan. 29, 2026): https://www.concordmonitor.com/2026/01/29/new-hampshire-opts-into-federal-education-scholarship-program/ - New Hampshire HB 1774 (2026): bill status and text: https://www.citizenscount.org/bills/hb-1774-2026 Canonical: https://eftccredit.com/news/new-hampshire-ayotte-opts-in-january-2026 ### Alaska opted in. Its teachers' union says the state constitution's no-aid clause makes that illegal. Date: 2026-01-29. Category: analysis. State: AK. Most of the state-level fights over the federal Scholarship Tax Credit (FSTC / ECCA / §25F) have turned on politics, whether a governor or legislature wants the program at all. Alaska has surfaced a different and sharper question, one of state constitutional law. In late January 2026, Governor Mike Dunleavy signed Alaska into the federal credit ahead of its January 1, 2027 launch, putting the state on the roster of early opt-ins. Within days, NEA-Alaska, the state's largest teachers' union, argued that the move is unlawful under Alaska's own constitution, setting up a legality dispute that is distinct from the national voucher framing the unions have used elsewhere. The union's argument is rooted in Alaska's constitutional no-aid clause, which bars the use of public funds for the direct benefit of private or religious educational institutions. NEA-Alaska President Laura Capelle asserted that channeling the federal credit toward private-school tuition would run headlong into that prohibition, regardless of how the dollars are labeled. Alaska's no-aid clause is among the stricter such provisions in the country, and it has shaped the state's school-choice litigation before, which is why the union's challenge lands differently here than a generic objection that §25F is a voucher in disguise. The question NEA-Alaska is raising is not whether the program is good policy, but whether a state with a strict no-public-funds clause can lawfully participate in a federal credit that ultimately reaches private and religious schools. Education Commissioner Deena Bishop rejected the premise. Her position is that §25F does not move public money at all: the scholarships are funded by private charitable donations routed through Scholarship Granting Organizations, and the donors receive a federal income-tax credit (capped at $1,700 per donor) rather than a state appropriation. In Bishop's framing, no state dollars are spent, no state revenue is reduced, and the constitutional no-aid clause is therefore never triggered. As she put it, the money is literally individual money, and no public money is reduced. That public-versus-private characterization is the entire ballgame: if the credited donations count as private funds, Alaska's no-aid clause has nothing to grab onto; if a court treats the federal tax credit as a form of public subsidy directed at private schooling, the clause may bar Alaska's participation outright. The dispute is, for now, unresolved. For donors, families, and prospective SGO founders watching Alaska, this is a bellwether for how strict-no-aid states will fit into a national program built on private donations and federal credits. The reasoning tracks a familiar line in school-choice law, that a tax credit is not a government expenditure, a distinction the U.S. Supreme Court drew in a 2011 Arizona case when it held taxpayers lacked standing to challenge a state tuition-tax-credit program. Whether Alaska's courts apply that logic to a strict state no-aid clause is the open question. We cover the broader [union opposition to §25F and the voucher framing](https://eftccredit.com/news/who-opposes-25f-unions-democrats-repeal-bill-2026) separately; this Alaska dispute is a narrower constitutional-legality challenge. Alaska's current status, and every other state's, is tracked on our [Alaska state page](https://eftccredit.com/states/alaska) and the [state participation map](https://eftccredit.com/states), and the mechanics of how the credit is funded are explained in [how the federal tax credit works](https://eftccredit.com/learn/federal-tax-credit-explained). Sources: - Anchorage Daily News: Dunleavy opts Alaska in to federal tax credit scholarship program that could benefit private schools (Jan. 29, 2026): https://www.adn.com/alaska-news/education/2026/01/29/dunleavy-opts-alaska-in-to-federal-tax-credit-scholarship-program-that-could-benefit-private-schools/ Canonical: https://eftccredit.com/news/alaska-nea-no-aid-clause-challenge-25f-opt-in-january-2026 ### New Hampshire opts into the federal §25F scholarship tax credit: Gov. Ayotte announces participation during School Choice Week Date: 2026-01-29. Category: state-action. State: NH. On January 29, 2026, during National School Choice Week, Republican Gov. Kelly Ayotte announced that New Hampshire would opt into the new federal Education Tax Credit program for scholarship granting organizations created under §25F of the One Big Beautiful Bill Act. As reported by the Concord Monitor, the decision clears the way for New Hampshire taxpayers to give to approved scholarship granting organizations (SGOs) and claim a dollar-for-dollar federal tax credit of up to $1,700 per taxpayer. The credit becomes available for the 2027 tax year, so the practical effect of the announcement lands at the start of next year rather than immediately. Children's Scholarship Fund New Hampshire, a long-running in-state scholarship nonprofit, positioned itself to administer the federally backed scholarships, and its executive director Kate Baker Demers welcomed the move in both the organization's own announcement and the Monitor's coverage. The mechanics are what set §25F apart from an ordinary charitable deduction. A taxpayer who donates to a qualifying SGO claims the contribution back as a credit, not a write-off, meaning the federal government effectively offsets the gift up to the $1,700 ceiling. The donated dollars then fund scholarships that families can use for tuition and other qualifying education expenses. Eligibility runs to families earning up to 300 percent of their area median gross income, a regional threshold set in the statute rather than a single flat statewide figure. New Hampshire's entry follows the advance-election path the federal government laid out for states under §25F for the 2027 program year; that election is what places a state on the federal roster and is a precondition for any of its taxpayers to claim the credit. The IRS confirmed in a newsroom release that more than half the states had signed up, and New Hampshire appears on that participating-states list. For SGOs and donors in New Hampshire, the timeline now matters more than the headline. Because scholarships do not flow until the 2027 tax year and states' lists of qualifying SGOs are due to the federal government ahead of the January 1, 2027 launch, the months between now and then are the window in which organizations get qualified, donors plan their giving, and families learn whether they fall under the income threshold. Children's Scholarship Fund NH is the most visible candidate to run scholarships in the state, but the program is open to other qualifying organizations as well. Operators weighing whether to stand up or expand a qualifying organization can review how the program works in our [explainers](https://eftccredit.com/learn) and see the current national field in the [SGO directory](https://eftccredit.com/sgos); the donation-and-scholarship machinery can run on software built specifically for §25F. New Hampshire's status, including what families need to know locally, is tracked on our [New Hampshire state page](https://eftccredit.com/states/new-hampshire). In June 2026, the legislature followed the executive opt-in with a statute: New Hampshire [passed HB 1774, the implementing framework](https://eftccredit.com/news/new-hampshire-hb1774-25f-implementing-statute-ayotte-desk-june-2026) that directs the Department of Revenue Administration to participate in the credit and the Department of Education to build and submit the state's qualifying-SGO list. New Hampshire joins a roster of more than 20 states that have committed ahead of the 2027 launch. Virginia was [first to opt in under Glenn Youngkin](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), Florida followed when [Ron DeSantis signed on](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and Colorado came in early under [Jared Polis](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025). The IRS later published its own [official list of 27 states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) making the advance election, the count that supersedes the smaller running tallies cited at the time of individual announcements. On the cap itself, the figure is fixed in statute, as our explainer on [why the credit is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026) lays out. How quickly New Hampshire builds out its SGO network, and how many donors use the credit in its first year, will determine how much the decision actually delivers for families. The full national picture is mapped on our [state participation map](https://eftccredit.com/states). Sources: - Concord Monitor: New Hampshire opts into federal education scholarship program (Jan. 29, 2026): https://www.concordmonitor.com/2026/01/29/new-hampshire-opts-into-federal-education-scholarship-program/ - Children's Scholarship Fund NH: New federal Education Tax Credit strengthens support for students across New Hampshire: https://nh.scholarshipfund.org/new-federal-education-tax-credit-strengthens-support-for-students-across-new-hampshire/ - IRS Newsroom: More than half the U.S. states signed up to participate (lists New Hampshire): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - IRS Newsroom: Treasury and IRS allow states to make an advance election under §25F: https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill Canonical: https://eftccredit.com/news/new-hampshire-ayotte-opts-in-25f-january-2026 ### Florida Gov. Ron DeSantis opts Florida into the Federal Scholarship Tax Credit Date: 2026-01-28. Category: state-action. State: FL. [Florida](https://eftccredit.com/states/florida) Governor Ron DeSantis announced on January 28, 2026 that Florida will opt in to the Federal Scholarship Tax Credit (FSTC), also known as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. With Florida's participation, the state's families will be eligible for federal scholarships funded through the program when it goes live on January 1, 2027. Florida already operates one of the largest state-level scholarship tax credit programs in the country, so layering the federal FSTC alongside existing state programs is a relatively natural fit. Florida donors will be able to participate in both programs through separate contributions, taking the federal $1,700 credit on their federal returns and the state credit on their Florida returns. Florida joins Texas, Louisiana, Iowa, and a growing list of other states that have opted in ahead of the program's launch. The state's existing infrastructure of [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) positions Florida families to access FSTC scholarships quickly once the program begins. Sources: - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ - Ballotpedia: State participation in the federal K-12 education tax credit scholarship program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program Canonical: https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026 ### Step Up For Students spins up a dedicated §25F SGO for Florida: the Step Up, Step Further Scholarship Fund Date: 2026-01-28. Category: state-action. State: FL. When [Governor Ron DeSantis opted Florida into the federal Scholarship Tax Credit (FSTC / ECCA / §25F) on January 28, 2026](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), the open question was who would actually move the money. The answer arrived the same morning. Step Up For Students, the nonprofit that already administers Florida's state scholarship programs for more than 500,000 students, announced that it will participate in administering the federal program, and that it is doing so by establishing the Step Up, Step Further Scholarship Fund, described in its own materials as "a separate 501c3 non-profit." Rather than route federal donations through its existing state Scholarship Funding Organization, the largest incumbent in American school choice is standing up a distinct federal entity built for §25F from the ground up. The structural choice is the news here, and it is instructive for every operator weighing the same decision. Step Up could have retrofitted its state apparatus to take federal contributions; instead it created a clean, purpose-built vehicle with its own public-facing site (stepupstepfurther.org, also reachable at federalscholarshiptaxescredit.org) and a live donor and parent interest list inviting Floridians to sign up before the program opens. Keeping the federal SGO legally separate insulates the §25F program's compliance posture, accounting, and donor reporting from the state programs it already runs, an approach that matters because the federal credit carries its own distinct rules. The fund commits to spending at least 90% of donations on scholarships, the floor that defines a qualifying SGO under the statute, a standard we break down in [our guide to the 90/10 rule](https://eftccredit.com/learn/sgo-90-10-rule-compliance). The economics for donors track the federal statute exactly. Contributions to the Step Up, Step Further Scholarship Fund will be accepted beginning January 1, 2027, and they carry a dollar-for-dollar federal tax credit of up to $1,700 per donor, with any unused credit eligible to be carried forward for up to five years. On the family side, the fund says it will serve households earning up to 300% of area median income, covering K-12 students at both public and private schools, a deliberately broad eligibility band that mirrors the wide reach §25F was written to allow. For an organization that has spent two decades operating inside Florida's state credit framework, the federal program is additive: Florida donors will be able to support both the state and federal programs through separate contributions, claiming each credit on the corresponding return. For prospective SGO founders watching the rollout, Step Up's move sets an early template: when the nation's biggest school-choice operator chose to build a separate federal entity rather than bolt §25F onto its existing structure, it signaled that the federal program is its own beast deserving its own vehicle. The pattern, a dedicated 501(c)(3), a live interest list well ahead of the January 1, 2027 launch, and an explicit 90% scholarship commitment, is worth studying for anyone mapping out [how to start an SGO](https://eftccredit.com/learn/how-to-start-an-sgo). We track Florida's status and its participating organizations on the [Florida state page](https://eftccredit.com/states/florida), maintain a running [directory of scholarship-granting organizations](https://eftccredit.com/sgos) by state, and follow the broader rollout on the [participation map](https://eftccredit.com/states). Sources: - Step Up, Step Further Scholarship Fund (official site): https://stepupstepfurther.org/ - NextSteps (Step Up For Students): Florida governor opts in, Step Up announces plans to administer (Jan. 28, 2026): https://nextstepsblog.org/2026/01/florida-governor-opts-in-to-federal-scholarship-tax-credit-program-step-up-for-students-announces-plans-to-administer/ - Step Up For Students: Federal Scholarship Tax Credit page: https://www.stepupforstudents.org/federal-scholarship-tax-credit/ - Step Up, Step Further: Florida Expands Opportunity Through the Federal Scholarship Tax Credit Program: https://federalscholarshiptaxescredit.org/florida-expands-opportunity-for-students-through-federal-scholarship-tax-credit-program/ Canonical: https://eftccredit.com/news/step-up-for-students-launches-dedicated-25f-sgo-florida-january-2026 ### South Carolina opts into the federal Scholarship Tax Credit: Gov. McMaster signs on for 2027 Date: 2026-01-28. Category: state-action. State: SC. South Carolina has decided to participate in the federal Scholarship Tax Credit (FSTC / ECCA / §25F), Gov. Henry McMaster's office confirmed in late January 2026. As reported by the Post and Courier on January 28, a spokesman for the governor said McMaster opted the state in, clearing the way for South Carolina donors to give to qualifying in-state Scholarship Granting Organizations (SGOs) and claim a dollar-for-dollar federal tax credit of up to $1,700. The credit becomes available January 1, 2027, the same date by which states' lists of qualifying SGOs are due to the federal government, so the practical effect of the decision lands at the start of next year rather than immediately. McMaster, a Republican who has led the state since 2017, has been a consistent supporter of expanding private-school choice in South Carolina. The mechanics are what set §25F apart from a deduction. A taxpayer who donates to a qualifying SGO claims the contribution back as a credit, not a write-off, meaning the federal government effectively offsets the gift up to the $1,700 ceiling. The donated dollars then fund scholarships that families can use for tuition and other qualifying education expenses. South Carolina's participation is best understood as an opt-in decision confirmed by the governor's office rather than a fully executed formal filing: the cited reporting describes a decision to join, and South Carolina now appears on the IRS roster of participating states. Families become scholarship-eligible if their income falls under 300 percent of their area's gross median income, a threshold that varies by region. The Post and Courier noted that in parts of Charleston that ceiling reaches roughly $300,000, an illustration of how high the cap can run in higher-cost areas, not a flat statewide eligibility number. For SGOs and donors in South Carolina, the timeline now matters more than the headline. Because scholarships do not flow until 2027 and SGO lists are due to the federal government by January 1 of that year, the months ahead are the window in which organizations get qualified, donors plan their giving, and families learn whether they fall under the income threshold. Operators weighing whether to stand up or expand a qualifying organization can review how the program works in our [explainers](https://eftccredit.com/learn) and see the current national field in the [SGO directory](https://eftccredit.com/sgos); the donation-and-scholarship machinery can run on software built specifically for §25F. South Carolina's status, including what families need to know locally, is tracked on our [South Carolina state page](https://eftccredit.com/states/south-carolina). South Carolina joins a growing roster of states that have committed ahead of the 2027 launch. Virginia was [first to opt in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), and other Republican governors have followed, including Florida, where [Ron DeSantis signed on the same week](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026). The IRS has confirmed that more than half the states have signed up, and the agency's own [roster of participating states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) now includes South Carolina. How quickly the state builds out its SGO network, and how many donors take advantage of the credit in its first year, will determine how much the decision actually delivers for South Carolina families. The full national picture is mapped on our [state participation map](https://eftccredit.com/states). Sources: - Post and Courier: SC joins federal tax credit scholarship program (Jan. 28, 2026): https://www.postandcourier.com/education-lab/sc-mcmaster-federal-tax-credit-scholarship-voucher/article_6ec9c9c7-9dc7-43ce-ac85-2475a1515087.html - Palmetto Promise Institute: SC joins federal tax credit scholarship program: https://palmettopromise.org/sc-joins-federal-tax-credit-scholarship-program-widening-families-private-school-choices/ - IRS Newsroom: More than half the U.S. states signed up to participate in the federal scholarship tax credit program (lists South Carolina): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill Canonical: https://eftccredit.com/news/south-carolina-mcmaster-opts-in-25f-january-2026 ### Utah opts into the federal Scholarship Tax Credit: Gov. Cox announces the election with no opt-in bill Date: 2026-01-27. Category: state-action. State: UT. Utah has elected to participate in the federal Scholarship Tax Credit (FSTC / ECCA / §25F), Republican Gov. Spencer Cox announced in late January 2026. According to the Teach Coalition National Tracker, which last logged Utah's status on January 27, Cox stated on X that the state had opted into the program, the §25F credit that lets a taxpayer claim a dollar-for-dollar federal tax credit of up to $1,700 for contributions to qualified Scholarship Granting Organizations (SGOs). Cox, who has led Utah since 2021 as the state's 18th governor, has been a steady supporter of school-choice expansion. The credit itself does not become available until January 1, 2027, so the announcement is a commitment ahead of launch rather than a benefit that families can claim today. Utah was subsequently confirmed on the IRS's June 8, 2026 roster (IR-2026-76), which named 27 states as having signed up. It is worth being precise about the mechanism, because the announcement and the legal act are not the same thing. An X post or public statement is how Cox communicated the decision; the actual opt-in is a state advance election made to the IRS on Form 15714 under the procedures the Treasury set out (Rev. Proc. 2026-6). The statute lets that election be made by the governor or by another entity that state law designates, which is why a governor-level decision is a recognized executive path and not a workaround. Utah did not need a dedicated opt-in bill, but that is the default federal design rather than a Utah-specific shortcut: the governor advance-election route is the same path other states have used, including Virginia, where Gov. Glenn Youngkin opted in via Form 15714 and was [the first state to do so](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026). Other states reached the program through their legislatures, and a handful only after lawmakers [overrode their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026), so Utah's quiet executive election sits at the easier end of the spectrum. For SGOs and donors in Utah, the timeline now matters more than the headline. Because scholarships do not flow until 2027 and states' lists of qualifying SGOs are due to the federal government by January 1 of that year, the months ahead are the window in which organizations get qualified, donors plan their giving, and families learn whether they fall under the income threshold. Eligibility runs to families earning up to 300 percent of area median gross income, a ceiling that varies by region rather than a flat statewide number. Operators weighing whether to stand up or expand a qualifying organization can review how the program works in our [explainers](https://eftccredit.com/learn) and see the current national field in the [SGO directory](https://eftccredit.com/sgos); the donation-and-scholarship machinery, from intake to award tracking, can run on software built specifically for §25F. Utah's status, including what families need to know locally, is tracked on our [Utah state page](https://eftccredit.com/states/utah). A few caveats are worth flagging for anyone tracking the state closely. The January 27 date rests on the Teach Coalition tracker, and we were not able to independently retrieve the specific Cox X post it cites; a Ballotpedia News roundup published the same day on eleven states taking action did not list Utah, which indicates Utah was not part of that particular batch. The IRS roster, by contrast, is a primary confirmation that Utah is in. None of that changes the substance, only the precision of the announcement date. How quickly Utah qualifies SGOs, defines its application process, and how many donors use the credit in its first year will determine how much the decision actually delivers for Utah families. The full national picture, including which states have signed on through which path, is mapped on our [state participation map](https://eftccredit.com/states) and detailed in our coverage of the [IRS roster of participating states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). Sources: - IRS Newsroom: More than half the U.S. states signed up to participate in the federal Scholarship Tax Credit program (IR-2026-76, lists Utah): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - IRS: Federal Scholarship Tax Credit (FSTC) page ($1,700 credit, Jan. 1 2027 launch, opt-in process): https://www.irs.gov/government-entities/federal-state-local-governments/federal-scholarship-tax-credit-fstc - Teach Coalition National Tracker: Utah opted in per Gov. Cox (updated Jan. 27, 2026): https://teachcoalition.org/federalscholarships/ - Third Way: What we know so far about the federal tax credit scholarship program (opt-in by governor or designated entity; 300% AMGI): https://www.thirdway.org/memo/what-we-know-so-far-about-the-federal-tax-credit-scholarship-program - Ballotpedia News: Eleven states take action on federal school choice tax credit program in January (Jan. 27, 2026): https://news.ballotpedia.org/2026/01/27/eleven-states-take-action-on-federal-school-choice-tax-credit-program-in-january/ Canonical: https://eftccredit.com/news/utah-governor-cox-opts-in-25f-january-2026 ### Oklahoma's Stitt Opts Into the Federal §25F Credit by Executive Order and Orders a School Choice Hub Date: 2026-01-27. Category: state-action. State: OK. Oklahoma Gov. Kevin Stitt (R) marked National School Choice Week by signing Executive Order 2026-03 on January 27, 2026, announcing that the state would participate in the federal §25F scholarship tax credit for the 2027 tax year. The same order directed the creation of an Oklahoma School Choice Hub within 90 days, a digital portal designed to help families compare public, charter, and participating private schools in one place. The move put [Oklahoma](https://eftccredit.com/states/oklahoma) on the early-mover side of a national rollout that has seen governors across the country signal their intent through 2026 (see our [national opt-in map](https://eftccredit.com/states)). The federal §25F credit, created by the One Big Beautiful Bill Act, is a dollar-for-dollar federal income tax credit of up to $1,700 per individual taxpayer for contributions to qualified Scholarship Granting Organizations, effective January 1, 2027. Scholarships flow to families earning up to 300% of their area median income. The credit only operates where the governor has opted the state in and the state has submitted its list of qualified SGOs to the IRS, which is why early announcements like Stitt's matter for the organizations that will eventually distribute the funds. We walk through the mechanics in our [explainers](https://eftccredit.com/learn), including why the per-taxpayer cap is $1,700 and not $3,400 ([the statute already settles this](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026)). Stitt's January executive order announced participation and stood up the School Choice Hub, but it did not by itself complete every formal step of the federal election. That came later in the session: Oklahoma HB 3704 passed the House 73 to 20 on March 23, cleared the Senate 38 to 8 on April 15, and was signed by Stitt on April 17, 2026. The bill directs the governor to formalize the state's federal election and names the Oklahoma Tax Commission as administrator, converting the executive announcement into durable statute. Oklahoma's path of executive signal followed by legislative codification echoes the executive route taken in [Alaska](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026), and contrasts with the [veto-override path](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026) that carried other states across the line. For SGO operators, Oklahoma is now a live market. The IRS confirmed Oklahoma on its official participating-states list in IR-2026-76 on June 8, 2026, one of 27 states recognized at that point (see [our coverage of the IRS list](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026)). States were able to begin signaling participation as early as January 1, 2026, using the advance-election procedure under Rev. Proc. 2026-6 and [IRS Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025), which lets prospective SGOs start organizing before a state submits its final SGO roster. Organizations preparing to operate in Oklahoma can find peers in our [SGO directory](https://eftccredit.com/sgos) and can run their programs on software purpose-built for §25F intake, eligibility, and donor receipting. The next milestone to watch is Oklahoma's submission of its qualified SGO list and the standup of the School Choice Hub, the 90-day deliverable from the January order. Both steps will determine when Oklahoma families can actually direct §25F-funded scholarships and when SGOs can begin accepting contributions for the 2027 tax year. As more governors join the program, from [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026) to later entrants, Oklahoma's combination of an early executive announcement and a same-session statutory backstop offers a template other states are likely to follow. Sources: - OCPA: Stitt launches school choice hub, opts Oklahoma into new federal tax credit: https://ocpathink.org/post/independent-journalism/stitt-launches-school-choice-hub-opts-oklahoma-into-new-federal-tax-credit - OCPA: House votes to lock in Oklahoma's participation (HB 3704): https://ocpathink.org/post/independent-journalism/house-votes-to-lock-in-oklahomas-participation-in-federal-school-choice-tax-credit - OK House: Federal Scholarship Tax Credit Becoming Law (HB 3704): https://www.okhouse.gov/posts/news-20260430_2 - OK Legislature: HB 3704 committee substitute PDF: https://www.oklegislature.gov/cf_pdf/2025-26%20COMMITTEE%20SUBS/HCS/HB3704%20CS.PDF - IRS: More than half the states signed up (IR-2026-76, lists Oklahoma): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - IRS: Form 15714 Advance Election (Dec 2025): https://www.irs.gov/pub/irs-pdf/f15714.pdf - IRS: Rev. Proc. 2026-6 advance election procedure: https://www.irs.gov/pub/irs-drop/rp-26-06.pdf Canonical: https://eftccredit.com/news/oklahoma-stitt-executive-order-school-choice-hub-january-2026 ### Alaska opts into §25F by executive action, then admits it has no scholarship organizations and no rush to build them Date: 2026-01-26. Category: state-action. State: AK. On January 26, 2026, Alaska Governor Mike Dunleavy opted his state into the federal Scholarship Tax Credit (FSTC / ECCA / §25F), the program that lets taxpayers claim a one-for-one federal credit of up to $1,700 for donations to qualified Scholarship Granting Organizations. The announcement came through an official bulletin from Alaska's Department of Education and Early Development (DEED), which framed the move as expanding school choice. "Opting into the ECCA creates another opportunity for families and students to reap the benefits of school choice," Dunleavy said in the bulletin. Under the program, scholarships can flow to families earning up to 300% of area median gross income, and the dollars can cover tuition and fees at private, charter, micro, and home schools, along with dual-enrollment courses, educational therapies, tutors, and supplies. The program takes effect January 1, 2027. What distinguishes Alaska is not that it opted in, but how. There was no bill, no floor vote, and no veto fight. According to reporting by the Anchorage Daily News, Dunleavy signed the state on earlier in the week and the state simply had to notify the IRS of its intent to join the program, with DEED handling the notification administratively. That is a sharply different path from the one taken in states where participation was contested. Kentucky, Kansas, and North Carolina reached §25F only after legislatures [overrode their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026), and other governors have declined or vetoed opt-in bills outright. Alaska's executive election sidestepped the legislature entirely, and Dunleavy drew criticism for acting without first soliciting input from lawmakers, school boards, or parents. The opt-in is also notably premature on the ground. As of the announcement, no Scholarship Granting Organizations had been established in Alaska, the state had set no application process, and it had not submitted any SGO list. Education Commissioner Deena Bishop made clear the state was in no hurry to change that. "I don't see government moving that fast," she said. "It's no rush. We want to do it right." In practice, opting in is the first and easiest step: the credit cannot actually function in Alaska until qualified SGOs exist to receive donations and award scholarships, and building that infrastructure falls to the state's discretion. For donors and prospective SGO founders, that gap between the election and a working program is the part worth tracking, and it is detailed alongside every other state's status on our [Alaska state page](https://eftccredit.com/states/alaska) and the [national participation map](https://eftccredit.com/states). There is a further wrinkle: Dunleavy will be out of office before the program he opted into ever launches. The §25F credit becomes available January 1, 2027, after the 2026 election cycle, which means a successor administration will inherit the job of standing up SGOs, defining the application process, and administering the program day to day. That inheritance dynamic echoes Virginia, where [Glenn Youngkin opted in before handing the program to Abigail Spanberger](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), though Alaska's version is starker because the launch is further out and the supporting infrastructure does not yet exist. Whether the next governor builds out a robust SGO network or lets the election sit dormant will determine what Alaska families actually receive. Founders weighing whether to establish one of Alaska's first SGOs can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current national landscape in the [SGO directory](https://eftccredit.com/sgos). Sources: - Alaska DEED official bulletin: Governor Dunleavy Opts Alaska Into the Federal K-12 Education Tax Credit Scholarship Program (Jan. 26, 2026): https://content.govdelivery.com/accounts/AKDEED/bulletins/40636e2 - Anchorage Daily News: Dunleavy opts Alaska in to federal tax credit scholarship program that could benefit private schools (Jan. 29, 2026): https://www.adn.com/alaska-news/education/2026/01/29/dunleavy-opts-alaska-in-to-federal-tax-credit-scholarship-program-that-could-benefit-private-schools/ Canonical: https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026 ### North Dakota signals it will join the federal §25F scholarship tax credit: Gov. Armstrong commits the state to the 2027 program Date: 2026-01-26. Category: state-action. State: ND. On Monday, January 26, 2026, North Dakota Governor Kelly Armstrong (Republican), the state's 34th governor, announced that North Dakota will participate in the new federal tax credit for donations to Scholarship Granting Organizations, the program created under §25F. The credit is worth up to $1,700 per taxpayer per year, is nonrefundable, and was established by the One Big Beautiful Bill Act signed by President Trump. Taxpayers will be able to claim it beginning January 1, 2027. Armstrong made the announcement alongside State Superintendent of Public Instruction Levi Bachmeier, who called it an exciting opportunity for North Dakota families. The full text of the commitment is on the [North Dakota state page](https://eftccredit.com/states/north-dakota), which tracks the state's status against every other state on our [national participation map](https://eftccredit.com/states). It is worth being precise about what happened and what did not. Armstrong's announcement was a statement of intent to participate, not a completed federal opt-in. As of late January 2026, North Dakota had not yet submitted the IRS advance-election paperwork (Form 15714) that formally enrolls a state, placing it in the "statement only" tier alongside Arkansas, Indiana, and Iowa rather than with the states that had filed the form, such as Georgia, Idaho, Mississippi, Montana, and Virginia. The governor's office said the state plans to submit a list of approved Scholarship Granting Organizations to the U.S. Treasury in the coming months, and that additional program detail along with an eligible-SGO list will follow. The mechanics of that advance election are explained in our coverage of [IRS Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025). The §25F structure is straightforward at the federal level: taxpayers who donate to a qualified SGO can claim a nonrefundable credit of up to $1,700 against their federal tax, and the SGO turns those donations into K-12 scholarships for eligible families. To qualify, an SGO must be a 501(c)(3) public charity and cannot be a private foundation, and income limits apply to the families it serves. Armstrong's office said further Treasury guidance and a state eligibility list are still to come, so the exact roster of North Dakota organizations that can receive credit-eligible gifts is not yet set. For donors, the practical takeaway is that the credit does not function until qualified SGOs exist in the state to receive donations and award scholarships, and standing up that infrastructure is the next step. The fundamentals of how the credit works are laid out in our [explainers](https://eftccredit.com/learn). For organizations weighing whether to become one of North Dakota's first approved SGOs, the window between Armstrong's announcement and the program's January 1, 2027 launch is the time to prepare: confirming 501(c)(3) public-charity status, building a donor-intake and scholarship-award process, and getting on the state's approved list once it is published. Operators do not have to build that machinery from scratch, because there is software purpose-built for running a §25F program end to end, and the current national landscape of organizations is catalogued in our [SGO directory](https://eftccredit.com/sgos). Founders can see how the pieces fit together in our [explainers](https://eftccredit.com/learn) as the state moves from intent to a working program. North Dakota now joins a fast-moving group of states acting on the federal credit in early 2026, from [Virginia's formal opt-in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) to [Alaska's executive action](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026). The distinction to watch in North Dakota is the gap between Armstrong's stated commitment and a completed federal election: until the state files its advance election and publishes an approved-SGO list, participation remains an intention rather than a live program. Whether North Dakota converts that intent into a working credit, and how robust an SGO network it builds before 2027, is what will determine what families and donors in the state actually receive, and it is detailed on the [North Dakota state page](https://eftccredit.com/states/north-dakota). Sources: - ND Office of the Governor press release: Armstrong announces North Dakota to participate in federal tax credit for donations to Scholarship Granting Organizations (Jan. 26, 2026): https://www.governor.nd.gov/news/armstrong-nd-participate-federal-tax-credit-donations-scholarship-granting-organizations - Ballotpedia News: Eleven states take action on federal school choice tax credit program in January (Jan. 27, 2026): https://news.ballotpedia.org/2026/01/27/eleven-states-take-action-on-federal-school-choice-tax-credit-program-in-january/ - Ballotpedia: Kelly Armstrong (North Dakota): https://ballotpedia.org/Kelly_Armstrong_(North_Dakota) Canonical: https://eftccredit.com/news/north-dakota-armstrong-commits-to-25f-january-2026 ### Federal §25F Credit Could Be a Lifeline for Nevada's Starved Opportunity Scholarship Program Date: 2026-01-24. Category: analysis. State: NV. Gov. Joe Lombardo (R) opted Nevada into the federal Education Freedom Tax Credit (§25F) on Friday, January 23, 2026, filing an advance election with the IRS and Treasury via Form 15714. The move, confirmed by Fox5 Vegas and listed on the governor's office press page, makes Nevada one of the states electing into a program that offers donors a dollar-for-dollar federal tax credit of up to $1,700 per taxpayer for gifts to scholarship-granting organizations (SGOs), with any unused credit carried forward up to five years. The federal credit applies to taxable years beginning after December 31, 2026, which means donations and scholarships do not begin flowing until January 1, 2027. Scholarship eligibility under §25F runs to households at or below 300 percent of area median income, a federal threshold we explain in our [guide to how the credit works](https://eftccredit.com/learn). What makes Nevada's election notable is the condition of its existing state program. Nevada already runs a tax-credit scholarship vehicle, the Opportunity Scholarship program, but lawmakers have steadily squeezed its funding: the annual cap now sits around $6.65 million, down from a peak of roughly $26 million in the 2017-2018 school year. The state's SGOs cap individual awards at about $10,000 per year, though that figure is a program maximum rather than a typical grant. Reporting from The Nevada Independent indicates that actual average awards in 2023 ran closer to $4,000 to a little over $6,000, well short of the roughly $12,000 average private-school tuition in the state. The result is a program that reaches a limited number of families and rarely covers the full cost of attendance. For Nevada SGOs and donors, the federal credit is significant precisely because of that gap. Advocates expect that §25F scholarships could be stacked on top of the existing Opportunity Scholarship awards, channeling new donor dollars through Nevada SGOs for the first time since the state program was constrained, though the exact stacking mechanics depend on Treasury regulations that are not yet final. It is worth keeping the two programs' rules distinct: §25F eligibility is set at 300 percent of area median income under federal law, which is a different test than the income limits attached to the state Opportunity Scholarship program. We track how the federal floor interacts with state-level rules in our coverage of [whether §25F is a floor or a ceiling for state restrictions](https://eftccredit.com/news/federal-floor-or-ceiling-25f-state-restrictions-june-2026), and the $1,700 per-taxpayer cap itself is settled, as we explain in [what the statute already settles on the credit amount](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Nevada joins a growing roster of states that have made the election across party lines, including [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and [Alaska](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026), with the IRS publishing a consolidated list of advance-election states by mid-2026. Critics in Nevada have raised concerns that participation could tie the state's hands on future education policy, a tension covered in the second of The Nevada Independent's reports below. We follow Nevada's status, the state of its Opportunity Scholarship program, and any further movement on our [Nevada state page](https://eftccredit.com/states/nevada) and on the [national participation map](https://eftccredit.com/states). The practical question now is how quickly Nevada SGOs can prepare for a 2027 launch. Running a §25F program is largely an operations and compliance build: verifying household income against the federal threshold, tracking donor receipts and carryforwards, and reporting qualified organizations to the IRS. A growing number of scholarship organizations are standing up donor-acquisition and award workflows on software written for the federal credit from the start, rather than retrofitting tools built for older state programs. Operators sizing up the opportunity can study participating organizations across the [national SGO directory](https://eftccredit.com/sgos) as Nevada moves toward its first cycle of stacked federal and state scholarships. Sources: - The Nevada Independent: Federal program could offer lifeline to Nevada's starved school choice scholarship program: https://thenevadaindependent.com/article/federal-program-could-offer-lifeline-to-nevadas-starved-school-choice-scholarship-program - The Nevada Independent: Trump tax program could grow private schools, critics fear it could tie Nevada's hands: https://thenevadaindependent.com/article/trump-tax-program-could-grow-private-schools-critics-fear-it-could-tie-nevadas-hands - Fox5 Vegas: Nevada opts into federal tax credit scholarship program (Jan 23, 2026): https://www.fox5vegas.com/2026/01/23/nevada-opts-into-federal-tax-credit-scholarship-program/ Canonical: https://eftccredit.com/news/nevada-25f-lifeline-starved-opportunity-scholarship-january-2026 ### Washington Lawmakers File HJM 4013 Urging Gov. Ferguson to Opt Into the Federal §25F Credit Date: 2026-01-23. Category: state-action. State: WA. A group of Washington House Republicans introduced House Joint Memorial 4013 on January 23, 2026, a formal legislative request asking Democratic Gov. Bob Ferguson to opt the state into the federal Education Freedom Tax Credit (§25F). The memorial was read for the first time and referred to the House Education Committee the same day. Its prime sponsor is Rep. Michael Keaton (R), who represents the 25th Legislative District including Puyallup and serves as the assistant ranking Republican on the House Education Committee. Among the 25 Republican co-sponsors is Rep. Jim Walsh (R, 19th District, Aberdeen), who also chairs the Washington State Republican Party. The memorial leans on a striking number drawn directly from its own text: a conservative estimate of approximately $732 million in annual donations to Scholarship Granting Organizations serving Washington students if the state participates. The request is procedurally specific. HJM 4013 is addressed to Gov. Ferguson and the Office of Financial Management, and it asks the governor to exercise his authority under IRC section 25F(g)(1)(B) to elect Washington's participation, then to submit the required list of qualified SGOs to the IRS by January 1, 2027, or as early as practicable. That structure reflects how §25F actually works: the credit was created by Public Law 119-21, enacted July 4, 2025, and it is the governor of each state, not the legislature, who makes the election. The bill text accurately summarizes the mechanics, noting that the federal credit is worth up to $1,700 per taxpayer annually, that scholarships are limited to households at or below 300 percent of area median gross income, and that the program is effective for tax years beginning in 2027. We break down the governor-election structure and the household income limits in our [explainers on how the credit works](https://eftccredit.com/learn). For Washington families, SGOs, and donors, the memorial is a marker rather than a green light. A joint memorial carries no force of law; it is a formal expression of the chamber's sentiment directed at the governor, and the decision still rests entirely with Ferguson. The $732 million figure (rounded by some secondary coverage to "more than $700 million") signals the scale of donation volume that could flow to Washington scholarship organizations if the state participates, but none of it materializes unless the governor signs the election. The pressure has not come only from Olympia: U.S. Rep. Michael Baumgartner (WA-05, R) publicly pressed Ferguson in December 2025 to opt Washington in, after praising Colorado for moving early. Washington currently has no state tax-credit scholarship program of its own, which means §25F would represent a brand-new channel of private scholarship funding rather than a federal layer stacked on an existing state credit, the pattern seen in mature school-choice states. The contrast with states that have already acted is sharp. Republican and Democratic governors alike have made the election: [Virginia was the first state to opt in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado's Gov. Polis moved in December 2025](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), [Florida followed in January 2026](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and [New York's Gov. Hochul elected in May 2026](https://eftccredit.com/news/new-york-governor-hochul-opts-in-may-2026), putting 27 states on the IRS advance-election list by mid-2026. Democratic governors have not moved uniformly, however, a split we examine in our coverage of [how Democratic governors are dividing on §25F](https://eftccredit.com/news/democratic-governors-split-on-25f-2026). Ferguson's silence places Washington squarely in the undecided column, where a memorial from the minority party is unlikely on its own to force a decision. As of June 2026, the only recorded action on HJM 4013 is the January 23 first reading and referral to the House Education Committee, with no further movement, consistent with the memorial stalling in committee. Whether Washington joins the program now depends almost entirely on whether Gov. Ferguson chooses to make the election before the January 1, 2027 effective year. We track Washington's status, its lack of a current state program, and any movement from the governor on our [Washington state page](https://eftccredit.com/states/washington) and on the [national participation map](https://eftccredit.com/states). For SGO operators preparing in case Washington opts in, a §25F program is largely an operations and compliance build, and a growing number of organizations are standing up donor-acquisition and scholarship workflows on software written for the federal credit from the start. Operators can study existing participating organizations across the [national SGO directory](https://eftccredit.com/sgos). Sources: - HJM 4013 bill summary & status (WA Legislature): https://app.leg.wa.gov/BillSummary/?BillNumber=4013&Year=2025&Initiative=false - HJM 4013 bill text PDF (WA Legislature): https://lawfilesext.leg.wa.gov/biennium/2025-26/Pdf/Bills/House%20Joint%20Memorials/4013-K-12%20federal%20tax-credits.pdf - Michael Keaton (R, 25th LD) - Ballotpedia: https://ballotpedia.org/Michael_Keaton - Jim Walsh (R, 19th LD; WA GOP chair) - Ballotpedia: https://ballotpedia.org/Jim_Walsh_(Washington) - Baumgartner presses Ferguson to opt in (Seattle Red, Dec 2025): https://seattlered.com/education/baumgartner-education-credit/4115775 Canonical: https://eftccredit.com/news/washington-hjm-4013-urges-ferguson-opt-in-25f-january-2026 ### Nevada Opts Into the §25F Federal Scholarship Tax Credit: Gov. Lombardo Enrolls the State for 2027 Date: 2026-01-23. Category: state-action. State: NV. Republican Gov. Joe Lombardo formally enrolled Nevada in the federal Tax Credit Scholarship Program (§25F) on January 23, 2026, his office announced in a press release headlined "Governor Lombardo Opts-In To Federal Tax Credit Scholarship Program." The move makes Nevada a covered state for the program, which was created by the One Big Beautiful Bill Act passed in the summer of 2025 and takes effect January 1, 2027. Under §25F, individual taxpayers who donate to a qualifying Scholarship Granting Organization (SGO) can claim a dollar-for-dollar federal income tax credit of up to $1,700 per year, with the scholarship dollars flowing to families at or below 300 percent of their area median income whose children are eligible to attend public K-12 schools. Coverage from [Fox5 Vegas](https://www.fox5vegas.com/2026/01/23/nevada-opts-into-federal-tax-credit-scholarship-program/), mynews4, and The Nevada Independent each confirmed the announcement the same day. The mechanism here is an administrative opt-in, not a new statute or numbered executive order. Section 25F gives each state's governor the authority to make an advance election enrolling the state, and Lombardo's office exercised that authority directly through the governor's office rather than through the legislature. With the election made, Nevada must now establish an application process for prospective SGOs and submit a certified list of approved organizations to the U.S. Treasury. The governor's office said the finer details of Nevada's application process will follow once Treasury issues further guidance, which is consistent with the broader timeline: federal regulations governing §25F are still under development, and many operational specifics depend on rules Treasury and the IRS have not yet finalized. We walk through the governor-election structure and the household income limits in our [explainers on how the credit works](https://eftccredit.com/learn). For Nevada families, SGOs, and donors, the opt-in opens a new channel of private scholarship funding. Two features matter most for the organizations that will run it: donors can carry unused credits forward for up to five years, and an SGO must spend at least 90 percent of its income on scholarships, leaving no more than a tenth for administrative costs. Those provisions shape both fundraising strategy and the budgets of the scholarship organizations that will compete to be certified in Nevada. Standing up a §25F program is largely an operations and compliance build, from donor receipting and credit tracking to scholarship awards and Treasury reporting, and a growing number of organizations are running these workflows on software written for the federal credit from the start. Operators can study participating organizations across the [national SGO directory](https://eftccredit.com/sgos) as they prepare to apply. Nevada joins a roster of states that have moved early. [Virginia was the first state to opt in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado's Gov. Polis elected in December 2025](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), [Florida followed in January 2026](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and Alaska's Gov. Dunleavy made a comparable [executive opt-in that same month](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026). Lombardo's decision places Nevada among the states acting well ahead of the January 1, 2027 effective date, giving its scholarship organizations and donors a long runway to organize before the first credits can be claimed. The near-term question for Nevada is procedural: when Treasury publishes its implementing guidance, the state will open its SGO application process and begin building the certified list it must send to Washington. Until then, organizations interested in serving Nevada students can position themselves to apply quickly once the window opens. We track Nevada's status and any movement on the application process on our [Nevada state page](https://eftccredit.com/states/nevada) and across the [national participation map](https://eftccredit.com/states). For operators weighing how to launch a compliant program, our [explainers](https://eftccredit.com/learn) cover the requirements that apply uniformly across every covered state, Nevada included. Sources: - Fox5 Vegas - Nevada opts into federal tax credit scholarship program (Jan 23, 2026): https://www.fox5vegas.com/2026/01/23/nevada-opts-into-federal-tax-credit-scholarship-program/ - mynews4 - Nevada opts into federal school choice tax credit program: https://mynews4.com/news/local/nevada-opts-into-federal-school-choice-program-tax-credit-scholarship-joe-lombardo-big-beautiful-bill-trump-white-house-politics-education - The Nevada Independent - Trump tax program could grow private schools (confirms Lombardo = Republican): https://thenevadaindependent.com/article/trump-tax-program-could-grow-private-schools-critics-fear-it-could-tie-nevadas-hands - Office of Gov. Joe Lombardo press release - Governor Lombardo Opts-In To Federal Tax Credit Scholarship Program: https://gov.nv.gov/Newsroom/PRs/2026/2026-01-23_governor_opts-in_to_federal_tax_credit_scholarship_program Canonical: https://eftccredit.com/news/nevada-governor-lombardo-opts-in-25f-january-2026 ### Indiana Opts Into the Federal §25F Scholarship Tax Credit, With Five SGOs Already Lined Up Date: 2026-01-22. Category: state-action. State: IN. On January 22, 2026, Indiana announced it would opt into the new federal Scholarship Tax Credit (FSTC / ECCA / IRC §25F), an announcement made by Gov. Mike Braun (R) and posted to the State of Indiana's official events listing. Under the program, individual taxpayers can claim a nonrefundable federal credit of up to $1,700 for donations to qualified scholarship granting organizations (SGOs), with the credit becoming available January 1, 2027. Unused credit carries forward for up to five years. What set Indiana's announcement apart from earlier opt-ins was specificity: the state named five Indiana SGOs already planning to participate. You can track Indiana's status on our [Indiana state page](https://eftccredit.com/states/indiana) and the [national participation map](https://eftccredit.com/states). The five organizations the state identified are the Institute for Quality Education, Inc.; the Sagamore Institute Scholarship for Education Choice; the Lutheran Scholarship Granting Organization of Indiana, Inc.; the School Scholarship Granting Organization of Northeast Indiana, Inc.; and the Legacy Foundation. Naming participating SGOs at the moment of the announcement, rather than leaving families and donors to wait for a later certification round, is unusual. Indiana already runs a state-level SGO ecosystem, so several of these groups have years of experience administering scholarships, vetting eligibility, issuing donor receipts, and disbursing funds, the same operational machinery the federal credit will require. The federal credit is designed to layer on top of Indiana's existing 50% state SGO tax credit, with the two running in parallel. The state credit carries no contribution limits, while the federal credit is capped at $1,700 per individual per year and is nonrefundable, meaning it offsets federal tax liability rather than generating a refund beyond it. Indiana donors should be careful about how the two interact, because they do not both apply to the same dollars: under §25F(b)(2) the federal credit is reduced by any state credit the donor claims for the same qualified contributions, so accessing both benefits means separate gifts rather than double-crediting one, a point we work through in [what the statute already settles](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). For SGOs, the practical question is operational readiness, because a group must be positioned to accept credit-eligible federal donations, track them separately, and report to the U.S. Treasury once the program launches. Indiana's announcement did not specify the legal instrument it used to join, whether an IRS advance election, an executive action, or legislation, and the state's materials describe the move as opting in without naming the mechanism. That distinction matters because states have arrived at §25F by different roads: some by gubernatorial election like [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and a few only after legislatures [overrode their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). The IRS has documented the formal advance-election path in [Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025), and the credit cap itself is fixed in statute, as our explainer on [why the figure is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026) lays out. The work between now and the January 1, 2027 launch is operational, not political. Indiana's named SGOs, and any others that join, must build out the donor-facing intake, eligibility verification, scholarship disbursement, and Treasury reporting that credit-eligible contributions require. Operators standing up or expanding a §25F program can review how the credit works in our [explainers](https://eftccredit.com/learn) and see the broader national field in the [SGO directory](https://eftccredit.com/sgos); running a compliant program end to end (donor receipts, eligibility checks, disbursement, federal reporting) is exactly the workload software built for §25F is designed to carry. How quickly Indiana's organizations stand up that infrastructure, not the opt-in itself, will determine when Hoosier families actually see scholarships and when donors can begin claiming the credit. Sources: - State of Indiana (events.in.gov): Gov. Braun opts in to new federal tax credit for school choice scholarships: https://events.in.gov/event/gov-braun-opts-in-to-new-federal-tax-credit-for-school-choice-scholarships - WBIW: Governor Braun opts in to new federal tax credit for school choice scholarships (Jan. 22, 2026): https://www.wbiw.com/2026/01/22/governor-braun-opts-in-to-new-federal-tax-credit-for-school-choice-scholarships/ - Ballotpedia: Mike Braun (party and office confirmation): https://ballotpedia.org/Mike_Braun Canonical: https://eftccredit.com/news/indiana-governor-braun-opts-in-25f-january-2026 ### Why Georgia's $100M State Credit Is Now a Federal §25F Launchpad Date: 2026-01-21. Category: analysis. State: GA. Governor Brian Kemp (R) signed an IRS form at the state Capitol on January 20, 2026, opting Georgia into the federal Education Freedom Tax Credit (§25F), joining roughly fifteen other states that have made the election so far. The move matters more in Georgia than in most states because Georgia already runs one of the country's largest tax-credit scholarship programs: the Georgia Qualified Education Expense Tax Credit, which cost the state about $88.8 million in FY2025. (In May 2026 Gov. Kemp signed HB 328, raising that state credit's annual cap to $150 million for tax years beginning in 2027.) The state credit gives donors up to $2,500 as individuals and up to $5,000 for married couples filing jointly, dollar-for-dollar against their Georgia tax. With Kemp's signature, Georgia donors will be able to layer the new federal credit on top of that mature state machinery beginning in 2027. The mechanics are what make Georgia a launchpad rather than a duplicate. The federal §25F credit is worth up to $1,700 per taxpayer, claimed dollar-for-dollar for contributions to a qualifying Scholarship Granting Organization, and it becomes available beginning January 1, 2027. Georgia GOAL, the state's largest scholarship organization, administers the federal program through a separate entity it calls the American GOAL Scholarship Program, so a Georgia household can give to Georgia GOAL for the state credit and to American GOAL for the federal credit, claiming each on the corresponding return. The two credits are distinct programs with distinct rules: Georgia's state credit runs against an aggregate statewide cap that fills up each year (set at $150 million for 2027 under HB 328), while the federal program's overall volume is not capped the same way, even though each individual donor's federal credit tops out at $1,700. Federal scholarships are also means-tested, limited to families earning under 300% of area median income, a broad band that still narrows who the federal dollars can ultimately serve. For donors, the headline is the stacking. A married couple in Georgia that already maxes the $5,000 state credit can, in 2027, also direct contributions toward the federal credit and capture up to $1,700 per taxpayer on their federal return, two separate dollar-for-dollar offsets feeding scholarships under two different eligibility frameworks. We walk through how a state credit and the federal credit interact, and where they do not double-count, in our explainer on [the federal credit versus state tax credits](https://eftccredit.com/learn/ecca-vs-state-tax-credits). One caution worth flagging: GOAL's materials have floated a "potentially $3,400 for married couples" federal figure, but the joint cap under §25F is unsettled and the prevailing reading is $1,700 per taxpayer, a point we examine in [our look at what the statute already settles](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Treat $1,700 per taxpayer as the working number until Treasury says otherwise. The structural lesson for SGO operators is the same one playing out in [Florida, where Step Up For Students stood up a dedicated federal entity](https://eftccredit.com/news/step-up-for-students-launches-dedicated-25f-sgo-florida-january-2026) rather than retrofit its state vehicle: GOAL is running the federal program through a separate organization, American GOAL, instead of bolting §25F onto the SGO that handles Georgia's state credit. Keeping the federal arm legally distinct insulates its compliance posture, accounting, and donor reporting from the state program's rules, and it lets the organization meet the federal 90% scholarship floor and means-testing requirements on their own terms. Operators mapping the same decision can study the participating organizations on our [Georgia state page](https://eftccredit.com/states/georgia), compare structures across the [national SGO directory](https://eftccredit.com/sgos), and review the build-versus-retrofit tradeoffs in [our guide to starting an SGO](https://eftccredit.com/learn/how-to-start-an-sgo). Running a clean, purpose-built federal SGO is largely an operations problem, which is why a growing number of operators are standing up programs on software written for §25F from the start. Georgia's opt-in is a preview of how mature school-choice states will absorb §25F: not by replacing their existing programs, but by bolting a federal layer onto them and letting incumbents like GOAL run both arms in parallel. As more states make the election, the question shifts from whether the credit exists to which organizations can administer it cleanly across two sets of rules. We track every state's status on the [national participation map](https://eftccredit.com/states) and follow the rollout as new states and operators come online. Sources: - The Current GA: program size, FY2025 cost, Kemp signing: https://thecurrentga.org/2026/01/24/georgia-taxpayers-will-get-money-back-for-contributions-to-k-12-private-school-scholarships/ - Georgia GOAL: Federal Tax Credit (§25F) donor page: https://www.goalscholarship.org/for_donors/page/federal-tax-credit - Georgia GOAL: press release: Gov. Kemp signs Georgia into federal program (Jan 20, 2026): https://www.goalscholarship.org/blog/detail/gov-kemp-signs-georgia-into-federal-tax-credit-scholarship-program-for-k-12-families Canonical: https://eftccredit.com/news/georgia-kemp-opts-in-25f-stacks-on-100m-state-credit-january-2026 ### Montana Opts In to Federal §25F Scholarship Credit, Stacking on Its State SSO Program Date: 2026-01-21. Category: state-action. State: MT. On January 21, 2026, Montana Governor Greg Gianforte (R) announced that Montana had formally opted in to the new federal Scholarship Tax Credit created under §25F, making the state one of the early movers ahead of the program's January 1, 2027 launch. According to the governor's office, the decision lets Montana residents claim a federal tax credit of up to $1,700 per taxpayer for donations to approved Scholarship Granting Organizations (SGOs). The federal credit traces to the One Big Beautiful Bill Act, which President Trump signed in July 2025 and which authorized states to elect into the program beginning with the 2027 tax year. Gianforte, who currently chairs the Republican Governors Association, framed the move as expanding education freedom for Montana families. The mechanism here is an administrative election rather than new legislation. Ballotpedia reported on January 27, 2026 that Montana "formally opted into the program by submitting IRS Form 15714," the advance-election filing a governor (or a governor's designated official) uses to opt a state in, and it grouped Montana with Georgia, Idaho, Mississippi, and Virginia as states that took that step in January. That detail comes from Ballotpedia's tracking rather than the governor's press release itself, but it matches the route the IRS laid out when it published [Form 15714 in December 2025](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025), the same path early movers such as [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and [Alaska](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026) have used. Because the election is an executive filing, no floor vote or veto fight was required, unlike the contested paths several states traveled by [overriding their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). What makes Montana notable is that the federal credit lands on top of an existing state program. Montana already runs a Student Scholarship Organization Tax Credit administered by the Department of Revenue through EducationDonations.mt.gov, and the governor's announcement notes a $200,000 per-taxpayer cap on that state credit. The two figures should not be conflated: the $200,000 cap belongs to the Montana state SSO credit, while the federal §25F credit is a separate, dollar-for-dollar offset capped at $1,700 per taxpayer under federal law. For donors, that means Montana households giving to scholarship organizations in 2027 may be able to claim the state credit and the federal credit as distinct benefits on their respective returns, each governed by its own rules. We walk through how the federal figure is fixed in statute in our look at [why the cap is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). For SGO operators in Montana, the opt-in turns an established donation pipeline into a launchpad for the federal program, and the practical question becomes execution: which organizations will administer §25F-backed scholarships, and whether they run the federal program through a vehicle built for federal rules or retrofit an existing state entity. Federal scholarships carry their own requirements, including a 90% scholarship floor and means-testing of recipient families, so operators in states with mature SSO networks have generally found it cleaner to run the federal arm as a purpose-built program. Founders weighing how to structure one of Montana's first federal SGOs can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current national landscape in the [SGO directory](https://eftccredit.com/sgos), where a growing number of operators are running their programs on software written for §25F from the start. Montana's election was confirmed on the IRS roster published June 8, 2026 (IR-2026-76), which listed it among the [27 participating states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026) that had signed up by mid-year. With the credit not available until January 1, 2027, the year ahead is about buildout: standing up the SGO list, defining the application process, and clarifying how the federal credit interacts with the state's SSO program. Montana's status, alongside every other state's, is tracked on our [Montana state page](https://eftccredit.com/states/montana) and the [national participation map](https://eftccredit.com/states). Sources: - Montana Governor's Office press release (Jan. 21, 2026): https://news.mt.gov/Governors-Office/Montana-Opts-in-to-Federal-Tax-Credit-Scholarship-Program-Expanding-Education-Freedom - IRS IR-2026-76 (June 8, 2026): Montana on the 27-state roster: https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Ballotpedia (Jan. 27, 2026): Montana submitted IRS Form 15714: https://news.ballotpedia.org/2026/01/27/eleven-states-take-action-on-federal-school-choice-tax-credit-program-in-january/ - Greg Gianforte (R): Ballotpedia profile: https://ballotpedia.org/Greg_Gianforte Canonical: https://eftccredit.com/news/montana-gianforte-opts-in-25f-stacks-on-state-sso-credit-january-2026 ### Georgia opts into the federal scholarship tax credit: Kemp signs the IRS election, GOAL to run the §25F program through a new arm Date: 2026-01-20. Category: state-action. State: GA. Georgia has opted into the federal Scholarship Tax Credit (FSTC / ECCA / §25F). On January 20, 2026, Governor Brian Kemp (R) signed the IRS advance-election form committing the state to participate in the program, which lets individual taxpayers claim a one-for-one federal credit of up to $1,700 per taxpayer per year for donations to qualified Scholarship Granting Organizations. Days later, at the state Capitol on Tuesday, January 24, Kemp announced the move publicly with an unusually cheerful line for a tax filing. "That's probably the happiest I've ever been signing an IRS document," he said. The federal credit becomes available January 1, 2027, and in Georgia it is expected to reach families earning less than 300% of area median income, which works out to roughly $246,000 a year in metro Atlanta. The mechanism here matters, and it is worth being precise about. Georgia did not pass a new statute or issue an executive order to join the program. Kemp executed an advance election using IRS Form 15714, the Advance Election to Participate Under Section 25F for 2027, the same administrative path the Treasury and IRS opened for states under the One Big Beautiful Bill. Georgia was not acting alone or first: it opted in alongside Virginia and Mississippi in the same January cohort, and Ballotpedia counted eleven states moving on §25F during the month. The federal credit is capped at $1,700 per taxpayer per year. Some promoters have floated a doubled $3,400 figure for married couples filing jointly, but Treasury has not settled that question, so the durable number families and donors should plan around is $1,700 per taxpayer. We walk through why in [our breakdown of what the statute already settles](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Georgia is one of the few states entering §25F with an established scholarship infrastructure already in place, and the operational plan reflects that. Georgia GOAL Scholarship Program, the state's largest Student Scholarship Organization, says it will keep running the existing state Qualified Education Expense (QEE) credit under the Georgia GOAL name. A new arm, American GOAL Scholarship Program, will administer the federal §25F credit when it launches in 2027. That two-track structure, one organization running the state program and a separate affiliate running the federal one, is a model other SSOs and SGOs are likely to study as they decide how to handle parallel state and federal credits without commingling the two pools of funds. For donors, the near-term takeaway is that the credit does not exist yet: contributions cannot be made and credits cannot be claimed until the program goes live on January 1, 2027. Between now and then, the state and its scholarship organizations have to stand up the application and certification process, and prospective donors should track which organizations register to receive §25F gifts. For SGO and SSO operators watching Georgia, the GOAL/American GOAL split is a reminder that running a §25F program is its own administrative lift: separate eligibility checks, separate donation routing, separate compliance. Operators building that capacity from scratch can run their program on software purpose-built for §25F, and our [SGO directory](https://eftccredit.com/sgos) and [explainers](https://eftccredit.com/learn) lay out how the organizations work. Kemp's election fits a broader pattern we have been tracking state by state. Virginia [opted in early under Glenn Youngkin](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), Florida followed when [Ron DeSantis signed on](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and the broader picture, including states that reached §25F only by [overriding their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026), keeps shifting. Georgia's status, alongside every other state's, is detailed on our [Georgia state page](https://eftccredit.com/states/georgia) and the [national participation map](https://eftccredit.com/states). The question now is execution: whether Georgia's mature scholarship network can convert an easy advance election into a working federal credit by the 2027 launch. Sources: - Georgia GOAL: Gov. Kemp Signs Georgia Into Federal Tax Credit Scholarship Program for K-12 Families: https://www.goalscholarship.org/blog/detail/gov-kemp-signs-georgia-into-federal-tax-credit-scholarship-program-for-k-12-families - Georgia GOAL: Federal Tax Credit (§25F) page: https://www.goalscholarship.org/for_donors/page/federal-tax-credit - The Current GA: Georgia taxpayers will get money back for contributions to K-12 private school scholarships (Jan. 24, 2026): https://thecurrentga.org/2026/01/24/georgia-taxpayers-will-get-money-back-for-contributions-to-k-12-private-school-scholarships/ - Ballotpedia: Governors in three states announce they've formally opted into U.S. school choice tax credit scholarship program (Jan. 21, 2026): https://news.ballotpedia.org/2026/01/21/governors-in-three-states-announce-theyve-formally-opted-into-u-s-school-choice-tax-credit-scholarship-program/ - IRS: Treasury, IRS allow States to make an Advance Election to participate in the new federal tax credit under §25F (Form 15714): https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill Canonical: https://eftccredit.com/news/georgia-kemp-opts-in-25f-goal-runs-program-january-2026 ### Mississippi Opts Into §25F: Reeves Makes the Election, but the SGO List Is Still Coming Date: 2026-01-19. Category: state-action. State: MS. On January 19, 2026, Mississippi Governor Tate Reeves (R) announced that the state will participate in the federal Education Freedom Tax Credit (§25F), the program created by the One Big Beautiful Bill Act signed July 4, 2025. The credit is worth up to $1,700 per taxpayer, claimed dollar-for-dollar (and nonrefundable) against federal tax for cash donations to qualifying Scholarship Granting Organizations, with scholarships reserved for households at or below 300% of area median income. The program begins in federal tax year 2027, effective January 1, 2027, so Reeves's move is an advance commitment well ahead of the first dollar moving. The Office of the Governor framed the decision as a way to promote school choice for Mississippi families. The mechanism here is an advance election rather than legislation. On December 12, 2025, the IRS issued a notice allowing states to opt in early by submitting IRS Form 15714, and Ballotpedia reports that Mississippi formally elected to participate through that form. The governor's own press release describes the opt-in in plainer terms, as an administrative decision to join the program, while the "Form 15714" framing comes from Ballotpedia and the underlying IRS notice. Either way, it is the same act at different levels of detail: an executive opt-in that puts Mississippi on the participating list without a floor vote or a veto fight. We explain how the advance election works in our coverage of the [IRS Form 15714 advance election](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025), and we track which states have made the call on the [national participation map](https://eftccredit.com/states). The catch, and the part worth tracking, is that opting in is only the first step. Reeves said the Office of the Governor will designate the state's eligible Scholarship Granting Organizations "in the coming months," meaning SGO certification is still pending and Mississippi has not yet published a list of organizations that can actually receive donations. The credit cannot function on the ground until those SGOs exist and are approved, so there is a real gap between the election and a working program. That gap echoes [Alaska, where Governor Dunleavy opted in administratively before any SGOs were stood up](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026), and it stands in contrast to mature school-choice states that already had scholarship infrastructure to layer the federal credit onto. For now, Mississippi donors know the credit is coming but cannot yet point to a certified recipient. For prospective SGO founders, that pending designation window is the opportunity. Whoever gets certified first will be positioned to receive Mississippi's federal donations when the program goes live in 2027, and the state has signaled the door is open in the coming months rather than years. Founders weighing whether to establish one of Mississippi's first §25F organizations can review how the credit and the SGO role work in our [explainers](https://eftccredit.com/learn), see the current national landscape in the [SGO directory](https://eftccredit.com/sgos), and watch the state's certification status on our [Mississippi state page](https://eftccredit.com/states/mississippi). Standing up a compliant federal SGO, one that meets the 90% scholarship floor and the 300% area-median-income means test, is largely an operations problem, which is why a growing number of operators run their programs on software written for §25F from the start. Mississippi joins a wave of states that made the election in January 2026, from [Virginia's first-in-the-nation opt-in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) to [Florida under Governor DeSantis](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026). The shared lesson is that the headline opt-in is the easy part, and the substance follows in the certification and build-out that comes next. As Mississippi moves from election to a published SGO list, the question shifts from whether the credit exists to which organizations will administer it cleanly. We will follow the rollout as the state names its first eligible SGOs and the program comes online. Sources: - Office of the Governor of Mississippi press release (Jan 19, 2026): https://governorreeves.ms.gov/governor-reeves-opts-into-federal-tax-credit-scholarship-program-to-promote-school-choice/ - Ballotpedia News: Eleven states take action on federal school choice tax credit program in January (Jan 27, 2026): https://news.ballotpedia.org/2026/01/27/eleven-states-take-action-on-federal-school-choice-tax-credit-program-in-january/ - WCBI: Gov. Tate Reeves announces MS opt-in for Federal Tax Credit Scholarship program: https://www.wcbi.com/governor-tate-reeves-announce-mss-opt-in-for-federal-tax-credit-scholarship-program/ - ActionNews5: Gov. Reeves opts into scholarship program that promotes school choice (Jan 19, 2026): https://www.actionnews5.com/2026/01/19/gov-reeves-opts-into-scholarship-program-that-promotes-school-choice/ Canonical: https://eftccredit.com/news/mississippi-reeves-opts-in-25f-sgo-list-pending-january-2026 ### Alabama Spells Out Who Can Be a §25F SGO: ALDOR Publishes Certification Criteria Date: 2026-01-17. Category: regulatory. State: AL. Governor Kay Ivey (R) signed Executive Order No. 742 on January 16, 2026, opting Alabama into the federal Education Freedom Tax Credit (§25F) and naming the Alabama Department of Revenue (ALDOR) as the agency that will administer the state's part of the program. ALDOR has since published a guidance page, "The Education Freedom Tax Credit Program: Alabama's Part in the Federal SGO Program," that lays out, for the first time in Alabama, the concrete criteria an organization must satisfy to be certified as a scholarship-granting organization (SGO). The federal credit itself is worth up to $1,700 per taxpayer, claimed dollar-for-dollar for contributions to a qualifying SGO, and it takes effect beginning January 1, 2027. Alabama now joins the roughly fifteen states that have made the election, alongside earlier movers like [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) and [Alaska](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026), both of which opted in by executive action rather than legislation. The ALDOR page sets out six requirements an organization must meet to be certified in Alabama. It must be a 501(c)(3) nonprofit that is not classified as a private foundation. It must provide scholarships to 10 or more students who attend more than one school. It must spend at least 90% of the income it receives on student scholarships. It cannot earmark or reserve contributions for specific, named students. It may only fund scholarships for students in Alabama. And it must be certified by ALDOR before it can participate. These mirror the federal §25F structure, where scholarships are also means-tested to households earning up to 300% of area median income, a band that determines which students an Alabama-certified SGO can ultimately serve. The page notes one important caveat on timing: ALDOR says it is still awaiting additional guidance from the U.S. Treasury Department before it finalizes application deadlines, so certification is authorized but not yet operationally open, the same hold that [keeps every participating state from opening SGO applications](https://eftccredit.com/news/no-state-opened-sgo-certification-waiting-september-nprm-july-2026) until the September rules land. One figure on the ALDOR page is worth flagging for donors. The page states the credit cap as $1,700 per year for an individual and $3,400 for married couples filing jointly. The $3,400 joint figure is not settled: Treasury has not ruled on whether married couples can claim double the individual cap, and the prevailing reading of the statute is $1,700 per taxpayer regardless of filing status. We walk through why in [our analysis of what the §25F statute already settles](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Until Treasury says otherwise, donors and operators in Alabama should treat $1,700 per taxpayer as the working number rather than banking on the $3,400 joint figure that ALDOR's page currently cites. For prospective Alabama SGO operators, the practical takeaway is that the eligibility bar is now legible even if the calendar is not. The 90% scholarship floor, the no-earmarking rule, the ten-students-across-multiple-schools test, and the non-private-foundation requirement are exactly the kinds of compliance lines that have to be designed into an organization's accounting and grant-making from day one, not retrofitted later. That is the same build-versus-retrofit decision playing out in other states, where incumbents have often chosen to stand up a separate, purpose-built federal entity rather than bolt §25F onto an existing state-credit vehicle, as [Step Up For Students did in Florida](https://eftccredit.com/news/step-up-for-students-launches-dedicated-25f-sgo-florida-january-2026). Operators weighing how to structure an Alabama program can review the requirements alongside our [explainers on how the federal credit works](https://eftccredit.com/learn) and compare structures across the [national SGO directory](https://eftccredit.com/sgos). Meeting the 90% floor and the per-student means-testing cleanly is largely an operations problem, which is why a growing number of operators run §25F programs on software written for the credit from the start. Alabama's move is a useful marker of where the rollout sits in early 2026: states are opting in and publishing their certification rules, but final deadlines are stalled on the same pending Treasury guidance that has held up several other states. The substantive criteria are now public, so organizations can begin organizing toward certification, but no one can submit an application until ALDOR sets the dates. We track Alabama's status and its certified organizations as they come online on the [Alabama state page](https://eftccredit.com/states/alabama), and we follow every state's election on the [national participation map](https://eftccredit.com/states) as the 2027 launch approaches. Sources: - ALDOR: The Education Freedom Tax Credit Program: Alabama's Part in the Federal SGO Program: https://www.revenue.alabama.gov/tax-policy/the-education-freedom-tax-credit-program-alabamas-part-in-the-federal-sgo-program/ - Office of Governor Kay Ivey: press release confirming Alabama's participation in the federal program: https://governor.alabama.gov/newsroom/2026/01/governor-ivey-signs-executive-order-confirming-alabamas-participation-in-federal-education-freedom-tax-credit-program/ - Office of Governor Kay Ivey: Executive Order 742: https://governor.alabama.gov/newsroom/2026/01/executive-order-742/ Canonical: https://eftccredit.com/news/alabama-aldor-publishes-25f-sgo-certification-criteria-january-2026 ### Arizona Gov. Katie Hobbs vetoes FSTC / ECCA opt-in bill (SB 1106) Date: 2026-01-16. Category: state-action. State: AZ. [Arizona](https://eftccredit.com/states/arizona) Governor Katie Hobbs vetoed SB 1106 on January 16, 2026, the state legislature's bill to opt Arizona in to the Federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. Hobbs cited the absence of final IRS implementing regulations as part of her rationale for waiting. Arizona's veto is notable because the state already operates one of the country's largest existing state-level scholarship tax credit programs and has well-developed [Scholarship Granting Organization (SGO)](https://eftccredit.com/learn/sgo-guide) infrastructure. The veto means Arizona families will not be eligible for FSTC scholarships when the federal program goes live on January 1, 2027, unless the legislature overrides the veto or the governor reverses course in a subsequent year. FSTC opt-in is an annual decision, states submit a list of qualifying SGOs to the U.S. Treasury by January 1 each year. Arizona could revisit the decision once IRS guidance becomes clearer, particularly after the agency finalizes the proposed regulations announced in [IRS Notice 2025-70](https://eftccredit.com/news/irs-notice-2025-70-section-25f-comments). Sources: - Teach Coalition: National Federal Tax Credit Scholarship Tracker: https://teachcoalition.org/federalscholarships/ - Ballotpedia: State participation in the federal K-12 education tax credit scholarship program: https://ballotpedia.org/State_participation_in_the_federal_K-12_education_tax_credit_program Canonical: https://eftccredit.com/news/arizona-governor-hobbs-vetoes-fstc-opt-in-january-2026 ### Alabama Opts Into Federal §25F by Executive Order: Gov. Ivey Signs EO 742 Date: 2026-01-16. Category: state-action. State: AL. On January 16, 2026, Alabama Governor Kay Ivey (R) signed Executive Order No. 742, confirming Alabama's participation in the federal Education Freedom Tax Credit (§25F), the program created under the One Big Beautiful Bill Act signed in July 2025 that lets taxpayers claim a dollar-for-dollar federal credit of up to $1,700 for donations to qualified Scholarship Granting Organizations. The order directs the Alabama Department of Revenue (ALDOR) to administer the program and to certify eligible scholarship organizations in the state. The credit becomes available beginning January 2027, in line with §25F's January 1, 2027 launch date. Ivey framed the move as building on Alabama's existing school-choice infrastructure, namely the 2024 CHOOSE Act and the 2013 Alabama Accountability Act, rather than as a standalone program built from scratch. What sets Alabama apart is the instrument it used. Rather than have the state submit the IRS Form 15714 advance election that other governors filed around the same time, Ivey signaled participation through an executive order naming ALDOR as the administering agency. The distinction was noted explicitly by Ballotpedia, which reported on January 21 that Virginia's Glenn Youngkin had announced his state's intent on January 9 (a week before Ivey's order), while Mississippi's Tate Reeves (January 19) and Georgia's Brian Kemp (January 20) formally submitted Form 15714 advance elections in the week that followed. Alabama, by contrast, leaned on executive action and its standing Department of Revenue authority. The practical effect is similar (the state is in), but the paperwork trail differs, and that matters for donors and SGOs trying to confirm a state's status against the eventual IRS roster. For SGO operators and donors, the executive order is the starting gun, not the finish line. ALDOR now has to stand up the certification process that determines which organizations can receive §25F contributions in Alabama, and the federal rules carry their own requirements: a 90% scholarship floor, means-testing that limits awards to families earning under 300% of area median income, and donor reporting that is distinct from anything the CHOOSE Act or Accountability Act demand. Operators who already run state-credit programs in Alabama will face the same build-versus-retrofit decision that [Step Up For Students made in Florida](https://eftccredit.com/news/step-up-for-students-launches-dedicated-25f-sgo-florida-january-2026) and that [Georgia GOAL made with its separate American GOAL entity](https://eftccredit.com/news/georgia-kemp-opts-in-25f-stacks-on-100m-state-credit-january-2026), both of which kept the federal arm legally distinct. We track Alabama's certification progress and participating organizations on our [Alabama state page](https://eftccredit.com/states/alabama), and the broader landscape sits in the [national SGO directory](https://eftccredit.com/sgos). Alabama's executive-order path also echoes [Alaska, where Gov. Mike Dunleavy opted in administratively](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026) rather than through the legislature, though Alabama enters with far more existing scholarship machinery to build on. The mix of routes into §25F is widening: some states are filing the formal IRS advance election, some are acting by executive order, and others have reached the program only after [legislatures overrode gubernatorial vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). The variation in how states opt in, and how each documents that choice, is something we explain in our [explainers](https://eftccredit.com/learn) and map across every state on the [national participation map](https://eftccredit.com/states). The open question in Alabama is timing and detail: how quickly ALDOR publishes its certification standards, whether the agency aligns SGO requirements with the CHOOSE Act framework or runs §25F on a separate track, and how soon Alabama organizations can begin accepting federally creditable donations ahead of the 2027 launch. Founders weighing whether to establish one of Alabama's first §25F-eligible SGOs can review how the organizations work in our [explainers](https://eftccredit.com/learn) and see the current national picture in the [SGO directory](https://eftccredit.com/sgos). Because running a clean federal program means meeting the 90% floor, means-testing, and donor reporting from day one, a growing number of operators are choosing to run their programs on software written for §25F rather than retrofitting state-credit tooling. Sources: - Governor Ivey press release: Governor Ivey Signs Executive Order Confirming Alabama's Participation in Federal Education Freedom Tax Credit Program (Jan. 16, 2026): https://governor.alabama.gov/newsroom/2026/01/governor-ivey-signs-executive-order-confirming-alabamas-participation-in-federal-education-freedom-tax-credit-program/ - Ballotpedia News: Governors in three states announce they've formally opted into the U.S. school choice tax credit scholarship program (Jan. 21, 2026): https://news.ballotpedia.org/2026/01/21/governors-in-three-states-announce-theyve-formally-opted-into-u-s-school-choice-tax-credit-scholarship-program/ Canonical: https://eftccredit.com/news/alabama-ivey-executive-order-742-opts-into-25f-january-2026 ### Arkansas Announces It Will Participate in the Federal §25F Scholarship Tax Credit Date: 2026-01-16. Category: state-action. State: AR. On January 16, 2026, Arkansas Governor Sarah Huckabee Sanders (R) announced that Arkansas intends to participate in the new federal tax-credit scholarship program, the §25F Education Freedom Tax Credit created under the One Big Beautiful Bill Act (P.L. 119-21). According to the Governor's Office, the program begins January 1, 2027, and (in the words of the release) "individual taxpayers in Arkansas may now claim a nonrefundable federal tax credit for cash contributions to Scholarship Granting Organizations providing scholarships for elementary and secondary expenses." The release puts the limit plainly: "Individual taxpayers are limited to $1,700 in credits annually," which matches the §25F statute (a $1,700 per-taxpayer credit, 100% nonrefundable, regardless of filing status). Sanders framed the move as an extension of Arkansas LEARNS and its Education Freedom Account program, which the office says served more than 44,000 students in the 2025-26 school year. It is worth being precise about what the announcement is and is not. The Governor's Office release is a statement of intent to participate; it does not reference an IRS advance election, Form 15714, or "covered state" status, and as of late January the public record did not show Arkansas among the states that had formally filed. In its January 27 roundup, Ballotpedia grouped Arkansas with governors who said their states would participate but had not yet formally opted in, while listing Georgia, Idaho, Mississippi, Montana, and Virginia as the states that had filed the IRS advance election in January. Under the §25F framework, states opt in by making that advance election (Form 15714, available for filing on or after January 1, 2026), and the credit goes live January 1, 2027. So Arkansas has signaled it is coming; the documented federal filing is the next step to watch. Mechanically, §25F routes a dollar-for-dollar federal credit through Scholarship Granting Organizations rather than through the state treasury. A donor gives cash to a qualified SGO, claims the nonrefundable credit (capped at $1,700) on a federal return, and the SGO turns those contributions into K-12 scholarships. The federal rules carry their own guardrails that exist independent of any state program: scholarship eligibility is capped at families earning up to 300% of area median gross income, and SGOs face contribution, distribution, and reporting requirements written into the statute. In Arkansas, Secretary of Education Jacob Oliva was named in the announcement, and the practical work of certifying which organizations qualify will fall to the state once it formally enters. We track Arkansas status and participating organizations on our [Arkansas state page](https://eftccredit.com/states/arkansas), and the full national picture lives on the [participation map](https://eftccredit.com/states). For SGO operators and donors, the takeaway is that a §25F program is a distinct federal track, not a relabeling of the state's LEARNS Education Freedom Accounts. An organization that already grants Arkansas EFA scholarships will still face a build-versus-retrofit decision to meet the federal 300%-of-AMGI means test, the donor crediting and receipting rules, and the reporting §25F demands. Arkansas joins a growing and varied field: some governors have filed the formal IRS election like [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), some have acted administratively like [Alaska](https://eftccredit.com/news/alaska-dunleavy-executive-opt-in-25f-january-2026) and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and a handful of states have reached the program only after [legislatures overrode gubernatorial vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). How each state documents its choice is something we explain in our [explainers](https://eftccredit.com/learn), and you can see the organizations already standing up federal arms in the [national SGO directory](https://eftccredit.com/sgos). The open questions in Arkansas are sequencing and detail: when the state files (or confirms it has filed) the IRS advance election, whether Oliva's office aligns §25F certification with the existing LEARNS framework or runs it on a separate track, and how soon Arkansas organizations can begin accepting federally creditable donations ahead of the 2027 launch. Founders weighing whether to stand up an Arkansas §25F-eligible SGO can review how these organizations work in our [explainers](https://eftccredit.com/learn) and watch the national rollout in the [SGO directory](https://eftccredit.com/sgos). Because a clean federal program means meeting the means test, donor reporting, and distribution rules from day one, a growing number of operators are choosing to run their programs on software built for §25F rather than retrofitting state-credit tooling. Sources: - Arkansas Governor's Office press release: Arkansas to Participate in President Trump's Federal Tax Credit Scholarship Program for School Choice (Jan. 16, 2026): https://governor.arkansas.gov/news_post/arkansas-to-participate-in-president-trumps-federal-tax-credit-scholarship-program-for-school-choice/ - Ballotpedia News: Eleven states take action on federal school choice tax credit program in January (Jan. 27, 2026): https://news.ballotpedia.org/2026/01/27/eleven-states-take-action-on-federal-school-choice-tax-credit-program-in-january/ - IRS: Treasury, IRS allow states to make an advance election (Form 15714) to participate in the new federal tax credit under §25F: https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill - Congressional Research Service R48724: Federal Tax Credit Scholarship Program (300% AMGI eligibility, $1,700 credit): https://www.congress.gov/crs-product/R48724 Canonical: https://eftccredit.com/news/arkansas-sanders-announces-25f-participation-january-2026 ### Missouri Gov. Kehoe Says State Will Opt Into the Federal Scholarship Tax Credit for 2027 Date: 2026-01-14. Category: state-action. State: MO. Missouri will opt into the federal scholarship tax credit, Republican Gov. Mike Kehoe announced in his 2026 State of the State address on January 14, 2026. The 58th governor told lawmakers the state intends to participate in the program in 2027, which would let Missouri donors receive up to $1,700 in federal tax credits for contributions to scholarship granting organizations. The federal credit, codified at IRC §25F and enacted as part of the One, Big, Beautiful Bill, is a dollar-for-dollar credit that takes effect on January 1, 2027. Missouri now appears on the [IRS roster of states signed up to participate](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026), which the agency posted on June 8, 2026 with 27 states listed. The governor announced the state's intent to opt in, though the exact procedural route has not yet been specified in the public record. Under §25F, state participation is voluntary, and the program is structured so that participating states identify the SGOs that will deliver federally backed scholarships to families. Several states have reached the federal program by an executive decision, others through legislation, and a handful through [legislative veto overrides](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). Missouri's announcement places it alongside early movers such as [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), all of which committed ahead of the January 2027 launch. Missouri is not starting from scratch on tax-credit scholarships. The state already runs MOScholars, a program that awards state tax credits for contributions to educational assistance organizations and is administered by the Missouri State Treasurer's office. The federal §25F credit is a separate, federally administered program: the Treasurer's MOScholars materials do not reference it, and the state credit and the federal credit are governed by different rules and different authorities. Donors and operators should treat them as distinct tracks rather than assuming the two stack or share oversight. In the same address, Kehoe also proposed a $60 million funding increase for MOScholars, a state-level matter separate from the federal opt-in. For SGO operators, the practical takeaway is that Missouri families and donors are now on a path to the federal credit beginning in 2027, with the $1,700 dollar-for-dollar figure matching the §25F statute (and consistent with our explainer on why [the cap is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026)). Organizations that want to raise federal §25F dollars will need infrastructure built for the program's intake, allocation, and reporting requirements. Operators evaluating their options can review our [SGO directory](https://eftccredit.com/sgos) and the operator explainers in [our learn center](https://eftccredit.com/learn), including software purpose-built for §25F donation processing. Missouri's move is a snapshot in a fast-moving national picture. With the IRS list still growing and Treasury having [previewed proposed regulations](https://eftccredit.com/news/treasury-previews-25f-proposed-regulations-june-2026) in June 2026, the operational details of how participating states deliver the credit are still being filled in. We track every state's status on the [national map](https://eftccredit.com/states), and Missouri's specifics live on its [state page](https://eftccredit.com/states/missouri), which we will update as the state confirms its participation mechanism and as the program approaches its 2027 start date. Sources: - KTTN: Gov. Mike Kehoe delivers 2026 State of the State address (Jan. 14, 2026): https://www.kttn.com/governor-mike-kehoe-delivers-2026-state-of-the-state-address/ - IRS newsroom: More than half the US states signed up to participate in the federal scholarship tax credit program (Missouri listed; posted June 8, 2026): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Missouri State Treasurer: MOScholars program (EAO state tax credit): https://treasurer.mo.gov/MOScholars/ Canonical: https://eftccredit.com/news/missouri-governor-kehoe-opts-in-25f-january-2026 ### Virginia became the first state to opt in, now its new governor will decide whether to keep it Date: 2026-01-09. Category: state-action. State: VA. Virginia was the first state in the country to formally opt into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. Outgoing Governor Glenn Youngkin (R) announced and submitted the opt-in in his final weeks in office, with participation taking effect January 1, 2026; news coverage of the move ran in early January 2026. The program itself does not begin until January 1, 2027. The timing was contentious. Youngkin made the move days before leaving office, and critics, including the Virginia Education Association, characterized it as a last-minute attempt to lock Virginia in before the U.S. Treasury and IRS had finalized the program's rules. The VEA called on incoming Governor Abigail Spanberger (D), who took office in mid-January 2026, to review the final federal guidance before deciding whether Virginia should continue participating. That hands Virginia a distinction beyond being first: it is the first real test of whether a state's opt-in survives a change of administration and party. Because the FSTC opt-in is an annual decision, a governor submits (or declines to submit) a qualifying Scholarship Granting Organization list to the U.S. Treasury each participating year, a successor governor is not necessarily bound by a predecessor's election in future years. Whether Spanberger maintains, modifies, or reverses Virginia's participation ahead of the 2027 launch is being closely watched as a model for other states where control could change hands. We trace exactly where that reversal effort stands, a stalled Democratic bill and the renewal lever still in Spanberger's hands, in our follow-up on [whether Virginia can actually get out of §25F](https://eftccredit.com/news/virginia-can-it-leave-25f-hb359-stalls-spanberger-renewal-june-2026). If Virginia stays in, families at or below 300% of the relevant Area Median Gross Income will be eligible for scholarships through state-designated SGOs once the program goes live, funding tuition, tutoring, educational therapies, and other qualified K-12 expenses. Donors anywhere in the country can claim a non-refundable federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO. Sources: - Office of the Governor of Virginia: Youngkin announces Virginia is first state to opt in to the Education Freedom Tax Credit: https://www.governor.virginia.gov/newsroom/news-releases/2025/december/name-1077810-en.html - WVVA: Virginia is first state to opt in to federal Education Freedom Tax Credit; what that means for families: https://www.wvva.com/2026/01/09/virginia-is-first-state-opt-federal-education-freedom-tax-credit-what-that-means-families/ - WRIC: Virginia opts in to federal Education Freedom Tax Credit program, VEA condemns move: https://www.wric.com/news/virginia-news/virginia-federal-education-freedom-tax-credit-program/ - Virginia Education Association: VEA Condemns Youngkin's Last-Minute Move to Opt Virginia Into Federal Voucher Tax Credit: https://www.veanea.org/virginia-education-association-condemns-youngkins-last-minute-move-to-opt-virginia-into-federal-voucher-tax-credit/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026 ### Iowa Opts Into the Federal §25F Scholarship Tax Credit: Gov. Reynolds Makes Iowa an Early Adopter Date: 2026-01-05. Category: state-action. State: IA. On January 5, 2026, Iowa Governor Kim Reynolds (R) announced that Iowa would opt into the federal scholarship tax credit program created by the One Big Beautiful Bill Act, the §25F credit signed into law on July 4, 2025. According to her office's press release, the program will take effect in 2027 and will let taxpayers claim a dollar-for-dollar federal tax credit of up to $1,700 for contributions to qualified scholarship granting organizations (SGOs). The move places Iowa among the earliest states to commit, the sixth to indicate participation per Ballotpedia, joining a fast-growing roster that already includes [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026). The mechanics are set at the federal level and the same in every participating state. Individual taxpayers who donate to a certified SGO receive a non-refundable federal credit equal to their contribution, capped at $1,700 per taxpayer per year, with the credit applied directly against their federal tax bill rather than as a deduction. Eligible scholarships flow to K-12 families with household income below 300% of area median gross income (AMGI), a generous threshold that reaches well into the middle class in most Iowa metros. To bring the program online, the Iowa Department of Education will work with the Governor's Office to certify eligible SGOs. States formally join by filing IRS Form 15714 to make the advance election and submitting a list of approved SGOs to the Treasury Department. For Iowa donors, the credit is among the most favorable tax incentives available, because a dollar-for-dollar credit returns the full contribution rather than a fraction of it. For SGOs, certification is the gate: only organizations approved through the state process can receive credit-eligible donations and award the scholarships, so the certification framework the Department of Education builds over the next year will shape who participates and how quickly families see funds. Iowa already runs a mature state-level Educational Savings Account program, which gives it administrative experience that some newer opt-in states lack. Operators standing up a §25F-specific SGO can review how the credit works in our [explainers](https://eftccredit.com/learn) and see the broader national field in the [SGO directory](https://eftccredit.com/sgos); running a compliant program (donor receipts, eligibility checks, scholarship disbursement, Treasury reporting) is exactly what software built for §25F is designed to handle. The American Federation for Children celebrated the announcement in a January 6, 2026 release, with CEO Tommy Schultz characterizing Reynolds as an early adopter of the program. The advocacy push reflects how quickly the §25F landscape is consolidating: some states are arriving by gubernatorial election, others through legislation, and a few only after legislatures [overrode their governors' vetoes](https://eftccredit.com/news/veto-override-path-into-25f-three-states-2026). Iowa's path was straightforward by comparison, an executive decision backed by a supportive legislature and an existing school-choice infrastructure. The work ahead is operational. The credit does not become usable until 2027, and between now and then Iowa must certify SGOs, define the application and disbursement process, and submit its SGO list to Treasury. The pace of that buildout, not the opt-in itself, will determine when Iowa families can actually claim scholarships and when donors can begin contributing. We track each state's status, including Iowa's certification progress, on the [Iowa state page](https://eftccredit.com/states/iowa) and the [national participation map](https://eftccredit.com/states). Sources: - Office of Gov. Kim Reynolds press release: Gov. Reynolds Opts Into Federal Education Tax Credit Program, Expands School Choice for Iowa Families (Jan. 5, 2026): https://governor.iowa.gov/press-release/2026-01-05/gov-reynolds-opts-federal-education-tax-credit-program-expands-school-choice-iowa-families - Ballotpedia News: Iowa indicates participation in federal school choice tax credit program (Jan. 8, 2026): https://news.ballotpedia.org/2026/01/08/iowa-indicates-participation-in-federal-school-choice-tax-credit-program/ - American Federation for Children: AFC Celebrates Iowa Governor Kim Reynolds Opting In to Federal Scholarship Tax Credit (Jan. 6, 2026): https://www.federationforchildren.org/afc-celebrates-iowa-governor-kim-reynolds-opting-in-to-federal-scholarship-tax-credit/ Canonical: https://eftccredit.com/news/iowa-governor-reynolds-opts-in-25f-january-2026 ### Louisiana Opts Into the Federal §25F Scholarship Tax Credit, and the Senator Who Co-Wrote It Is From Louisiana Date: 2025-12-17. Category: state-action. State: LA. On December 17, 2025, Louisiana Governor Jeff Landry (R) announced that Louisiana would participate in the federal K-12 scholarship tax credit program created under the One Big Beautiful Bill Act, the §25F credit that lets taxpayers claim up to $1,700 for donations to qualified scholarship granting organizations (SGOs). The IRS confirmed the decision on June 8, 2026 in IR-2026-76, which lists Louisiana among the 27 states that have signed up ahead of the program's January 1, 2027 launch. The hometown angle is hard to miss: the very next day, December 18, 2025, Sen. Bill Cassidy (R-LA), a lead Senate author of the provision, applauded his home state's decision with the line, "Thank you, Governor Landry for adding Louisiana to the list." Cassidy co-led the Senate version of the Educational Choice for Children Act (ECCA) with Sen. Tim Scott (R-SC) before it was folded into the §25F credit, so Louisiana joining the program it helped originate carries a particular symmetry. The federal mechanics are uniform across every participating state. Individual taxpayers who donate to a certified SGO receive a non-refundable federal tax credit equal to their contribution, capped at $1,700 per taxpayer per year, applied dollar for dollar against their federal tax bill rather than as a deduction. The scholarships those SGOs fund flow to K-12 families with household income up to 300% of area median gross income, a threshold that reaches well into the middle class in most Louisiana metros. States join formally through the IRS advance election, as documented in [Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025), and by submitting a list of approved SGOs to Treasury. The $1,700 cap is fixed in statute, a point we unpack in [our breakdown of why the figure is $1,700, not $3,400](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). Louisiana arrives at §25F with infrastructure already in place. The state runs the Tuition Donation Credit Program, an SGO-style framework administered with four active School Tuition Organizations: ACE Scholarships, Arete Scholars, Aspiring Scholars, and Son of a Saint. That experience with donor receipts, eligibility checks, and scholarship disbursement positions Louisiana to plug into the federal channel quickly. One caveat for operators and families: the state program and the federal credit are not identical. Louisiana's Tuition Donation Credit Program caps eligibility at 250% of the federal poverty line, while §25F uses the more generous 300%-of-area-median-income standard, so the two run on different income rules even where the same organizations administer both. Operators standing up a federal-facing SGO can review how the credit works in our [explainers](https://eftccredit.com/learn) and see the broader national field in the [SGO directory](https://eftccredit.com/sgos); running a compliant §25F program (donor receipts, eligibility verification, disbursement, Treasury reporting) is exactly what software built for the credit is designed to handle. For Louisiana donors, the credit is among the most favorable incentives on the books, because a dollar-for-dollar credit returns the full contribution rather than a fraction of it. For the state's School Tuition Organizations, the question is whether they extend their existing operations into the federal program or whether new entrants compete for the same donor relationships and families. Louisiana's decision places it alongside early movers such as [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), and [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), all of which committed ahead of the launch, and on the same confirmed roster captured in the [IRS list of 27 states that have made the advance election](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). The work ahead is operational, not political. The credit does not become usable until January 1, 2027, and between now and then Louisiana must certify the SGOs that will deliver federally backed scholarships and submit that list to Treasury, all while Treasury itself finalizes the proposed regulations that will govern the program nationwide. The pace of that buildout, not the opt-in announcement, will determine when Louisiana families can actually claim scholarships and when donors can begin contributing. We track Louisiana's status and participating organizations on the [Louisiana state page](https://eftccredit.com/states/louisiana) and follow the national rollout on the [participation map](https://eftccredit.com/states). Sources: - IRS IR-2026-76: More than half the US states signed up to participate in the federal Scholarship Tax Credit program (includes Louisiana, $1,700 credit, June 8, 2026): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - Sen. Bill Cassidy press release applauding Louisiana's opt-in (Dec. 18, 2025): https://www.cassidy.senate.gov/?p=38793 - Louisiana Department of Education: Tuition Donation Credit Program: https://doe.louisiana.gov/topic-pages/louisiana-school-choice/tuition-donation-credit-program - AEI: One Big Beautiful Step Toward Education Freedom, How the Federal Scholarship Tax Credit Became Law (authorship, 300% AMI, January 2027 launch): https://www.aei.org/research-products/report/one-big-beautiful-step-toward-education-freedom-how-the-federal-scholarship-tax-credit-became-law/ Canonical: https://eftccredit.com/news/louisiana-governor-landry-opts-in-cassidy-applauds-december-2025 ### IRS releases Form 15714, states can pre-elect §25F (FSTC) participation Date: 2025-12-12. Category: regulatory. On December 12, 2025, the Treasury Department and the Internal Revenue Service issued IR-2025-121, published Revenue Procedure 2026-6, and released Form 15714, "Advance Election to Participate by State for the Federal Scholarship Tax Credit (FSTC)." Rev. Proc. 2026-6 (Internal Revenue Bulletin 2026-02) sets the exclusive procedure for the election; the form lets a state declare its intent to be a "covered State" for calendar year 2027 before it submits the formal list of qualifying [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) to the Treasury. Under the §25F statute, only donations to SGOs whose state has been certified can generate the federal Scholarship Tax Credit, and only K-12 students in a covered State are eligible to receive those scholarships. Form 15714 gives states a way to lock in their participation early in the program year so that donors and SGOs in those states have certainty about eligibility before the program's January 1, 2027 launch. The advance election is optional: a state may choose to file Form 15714 on or after January 1, 2026 and before its final SGO-list deadline, or it may simply submit the SGO list directly when ready. The IRS has said additional deadlines and procedures for subsequent years (2028 and beyond) will be issued in future guidance. The form complements the broader rulemaking process initiated through Notice 2025-70, which is gathering public comment on state certification, SGO requirements, donor substantiation, and household-income verification. For donors and families, Form 15714 doesn't change who is eligible for the credit or the scholarships, those rules come from the §25F statute itself, but it does add an early signal about which states will be participating. As of mid-2026, states have been using a mix of paths to opt in: gubernatorial certifications, legislative bills, and in three cases (Kentucky, Kansas, and North Carolina) legislative veto overrides. Sources: - IRS IR-2025-121: Treasury, IRS allow States to make an Advance Election to participate: https://www.irs.gov/newsroom/treasury-irs-allow-states-to-make-an-advance-election-to-participate-in-the-new-federal-tax-credit-for-individual-contributions-to-scholarship-granting-organizations-under-the-one-big-beautiful-bill - IRS Form 15714 (PDF), Advance Election to Participate: https://www.irs.gov/pub/irs-pdf/f15714.pdf - IRS Rev. Proc. 2026-6 (PDF), Advance Election procedure: https://www.irs.gov/pub/irs-drop/rp-26-06.pdf - IRS Notice 2025-70 (PDF): https://www.irs.gov/pub/irs-drop/n-25-70.pdf - IRS: Federal Scholarship Tax Credit (FSTC) program page: https://www.irs.gov/government-entities/federal-state-local-governments/federal-scholarship-tax-credit-fstc - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/irs-form-15714-advance-election-december-2025 ### Texas opts into the federal §25F scholarship tax credit, layering the $1,700 donor credit on top of its new $1B ESA Date: 2025-12-10. Category: state-action. State: TX. Governor Greg Abbott (R) announced on December 10, 2025 that Texas intends to opt in to the federal Scholarship Tax Credit (FSTC / ECCA / §25F), the program enacted under the One Big Beautiful Bill that lets individuals claim a dollar-for-dollar federal credit of up to $1,700 per year for gifts to qualifying Scholarship Granting Organizations. The governor's office framed the decision as a stated intent to participate rather than a completed filing, and the federal listing was confirmed months later: IRS news release IR-2026-76, published June 8, 2026, names Texas among the 27 states signed up for the program. Under §25F, credit a donor cannot use because their tax bill is too small carries forward for up to five years (the carryforward is of unused credit, not of contributions above the $1,700 cap), eligibility runs to families at or below 300% of area median income, and the program launches January 1, 2027. What makes the Texas move distinctive is the layer it sits on. Texas just stood up its own state-funded education savings account program, the Texas Education Freedom Accounts (TEFA), created by Senate Bill 2, which Abbott signed on May 3, 2025. Reporting on the signing put the initial allocation at roughly $1 billion, with the program slated to launch in the 2026-27 school year, and the Texas Comptroller adopted the implementing TEFA rules published in the December 12, 2025 Texas Register. By opting in to §25F two days before those rules posted, Texas positioned the federal $1,700 donor credit to run alongside its own ESA rather than in place of it. The two programs are funded and administered separately: TEFA is a state appropriation that puts money directly into family accounts, while §25F is a federal tax credit that incentivizes private donations into SGOs, which in turn fund scholarships. A point of mechanics worth keeping straight: the December 10 announcement was a stated intent to opt in, not a documented formal election. No public source shows Texas filing the IRS advance-election paperwork ([Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025)) specifically, and the confirmation that matters is the IRS roster itself. That [official list of 27 states](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026), released in June 2026, is what moves Texas from announced intent to confirmed participant. The distinction is the same one that has separated talk from commitment in other states this cycle, where governors signaled support well before any binding step was on the record. For SGO operators and donors, the Texas setup is unusually rich. Texans will be able to support scholarships through the federal §25F credit while the state separately funds ESAs through TEFA, which means two parallel money streams aimed at private-school access, governed by two different rulebooks. Donors take the $1,700 credit on their federal return; families draw on TEFA dollars through the state. The volume of need in a state this size, combined with fresh ESA infrastructure, makes Texas a natural early market for new SGOs, and operators standing up a program will need software built specifically for §25F donation routing, receipts, and the annual eligibility and carryforward tracking the statute requires. Our [SGO directory](https://eftccredit.com/sgos) and [explainers](https://eftccredit.com/learn) walk through what that operationally takes. Texas now sits alongside [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), and the rest of the confirmed roster heading into the January 1, 2027 launch. The open questions for the year ahead are the same ones facing every participating state: how Treasury's proposed regulations land, whether states can add their own conditions to the SGO list, and how the federal $1,700 credit interacts with state programs already on the books. Texas is one of the clearest tests of that last question, since few states are pairing a billion-dollar ESA with the federal credit on this timeline. Current status for Texas and every other state is tracked on our [Texas state page](https://eftccredit.com/states/texas) and the [national participation map](https://eftccredit.com/states). Sources: - Office of the Texas Governor: Abbott Announces Texas' Intent To Opt In To Federal School Choice Tax Credit Program (Dec 10, 2025): https://gov.texas.gov/news/post/governor-abbott-announces-texas-intent-to-opt-in-to-federal-school-choice-tax-credit-program - IRS IR-2026-76: More than half the US states signed up to participate in the federal scholarship tax credit program (June 8, 2026): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - HillCo Partners: Federal Tax Credit Scholarship Program & Texas Education Freedom Accounts Update (Dec 12, 2025): https://hillcopartners.com/89th-interim-education/federal-tax-credit-scholarship-program-texas-education-freedom-accounts-update/ - Community Impact: Gov. Abbott signs $1B education savings account bill (SB 2, May 3, 2025): https://communityimpact.com/austin/south-central-austin/texas-legislature/2025/05/03/gov-abbott-signs-1b-education-savings-account-bill-program-to-launch-in-2026/ Canonical: https://eftccredit.com/news/texas-abbott-opts-in-federal-25f-scholarship-tax-credit-december-2025 ### Colorado Gov. Polis opts Colorado into the Federal Scholarship Tax Credit Date: 2025-12-05. Category: state-action. State: CO. [Colorado](https://eftccredit.com/states/colorado) Governor Jared Polis announced on December 5, 2025 that Colorado will opt into the federal Scholarship Tax Credit (FSTC), the program known to Congress as the Educational Choice for Children Act (ECCA) and codified at IRC §25F. The announcement made Colorado one of the earliest states to formally signal participation ahead of the program's January 1, 2027 launch. In a November 2025 interview with The Colorado Sun ahead of the announcement, Polis called participation "a no-brainer for the state to take advantage of the federal tax credit scholarship program," describing it as "a real boom of investment in kids." Asked about Colorado's participation, he added: "I would be crazy not to." Polis framed donor contributions to [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) as charitable contributions eligible for federal tax credits, arguing that opting in lets federal dollars stay in Colorado rather than flowing to scholarship organizations in other states. Under §25F, Colorado families will be eligible to apply for scholarships through state-designated SGOs once the program goes live. Scholarships can support a range of K-12 educational expenses including tuition, tutoring, books and supplies, educational technology, after-school and summer programs, transportation, internet access, and targeted services for students with disabilities. Eligible students are those in households at or below 300% of the relevant Area Median Gross Income. Donors anywhere in the country can claim the federal credit beginning January 1, 2027, a non-refundable federal income tax credit of up to $1,700 per taxpayer for contributions to a qualifying SGO. As an opted-in state, Colorado will be eligible to receive donations through SGOs operating in the state, with scholarship funds flowing to Colorado students rather than students elsewhere. Sources: - The Colorado Sun: Colorado governor plans to opt into Trump-endorsed initiative that some fear will lead to voucher program: https://coloradosun.com/2025/12/05/colorado-federal-tax-credit-scholarship-program-voucher/ - Chalkbeat Colorado: Polis plans to opt Colorado into federal tax credit scholarship program: https://www.chalkbeat.org/colorado/2025/12/06/coalition-calls-on-polis-to-reject-trump-voucher-tax-credit/ - Sentinel Colorado: Colorado joins federal tax credit program; Polis dismisses bias concerns: https://sentinelcolorado.com/metro/colorado-joins-federal-tax-credit-program-polis-dismisses-bias-concerns/ - Cornell LII: 26 U.S.C. §25F: https://www.law.cornell.edu/uscode/text/26/25F Canonical: https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025 ### IRS issues Notice 2025-70 requesting public comment on §25F (FSTC) implementation Date: 2025-11-25. Category: regulatory. In November 2025, the Internal Revenue Service issued Notice 2025-70, requesting public comment on the implementation of the new Federal Scholarship Tax Credit (FSTC), codified at IRC §25F, the federal credit created by the Educational Choice for Children Act (ECCA) and enacted as Section 70411 of the One Big Beautiful Bill Act (P.L. 119-21). The notice signals the start of formal rulemaking. Treasury and the IRS announced they intend to issue forthcoming proposed regulations, and Notice 2025-70 specifically asks for input on issues including the annual state certification process for participating in the program, the requirements that [Scholarship Granting Organizations (SGOs)](https://eftccredit.com/learn/sgo-guide) must meet, donor substantiation, and verification of household income for eligible students. For donors and families, the practical takeaway is that key implementation details, including final guidance on whether married filers jointly receive a single $1,700 cap or $3,400, AMT coordination, and the specific IRS form donors will use to claim the credit, remain to be issued. Comments submitted in response to Notice 2025-70 are expected to shape the proposed regulations Treasury publishes ahead of the program's January 1, 2027 launch. The comment window closed on December 26, 2025, and Treasury and the IRS received more than 2,200 public comments, a sign of how much is at stake in the rulemaking and how contested some of the design choices are. As of early 2026, Treasury and the IRS were reviewing those comments while developing the proposed regulations. Tax practitioners and SGO operators are watching IRS rulemaking closely. The structure of the proposed regulations will determine how donors document contributions, how SGOs verify eligibility, and how states certify participation each year. Sources: - IRS Notice 2025-70 (PDF): https://www.irs.gov/pub/irs-drop/n-25-70.pdf - Current Federal Tax Developments: Technical Analysis of §25F Guidance: https://www.currentfederaltaxdevelopments.com/blog/2025/11/25/a-technical-analysis-of-25f-guidance-the-obbba-scholarship-tax-credit - CPA Practice Advisor: IRS Seeks Comments on New OBBBA Tax Credit Scholarship Program: https://www.cpapracticeadvisor.com/2025/11/25/irs-seeks-public-comment-on-new-obbba-tax-credit-scholarship-program/173939/ - Afterschool Alliance: Treasury and IRS reviewing public comments on the Federal Tax Credit Scholarship: https://www.afterschoolalliance.org/afterschoolsnack/Treasury-and-IRS-reviewing-public-comments-on-the-Federal-Tax_01-16-2026.cfm Canonical: https://eftccredit.com/news/irs-notice-2025-70-section-25f-comments ### South Dakota will join the federal §25F scholarship tax credit: Gov. Rhoden opts in with an SGO channel already in place Date: 2025-11-14. Category: state-action. State: SD. On Friday, November 14, 2025, South Dakota Governor Larry Rhoden (Republican) announced at Saint Joseph Academy in Sioux Falls that the state will participate in the new federal tax credit for donations to scholarship-granting organizations, the program created under §25F. The credit is permanent, dollar-for-dollar, and worth up to $1,700 per taxpayer per year for contributions to qualified SGOs, and it becomes claimable beginning in January 2027. Framing the decision, Rhoden said his goal as governor is to "support innovation, not to stand in the way." Rhoden, who took office in January 2025 after Kristi Noem's appointment to the federal government, made the commitment as states across the country weigh whether to opt in. South Dakota's status is tracked on the [South Dakota state page](https://eftccredit.com/states/south-dakota) and against every other state on our [national participation map](https://eftccredit.com/states). What sets South Dakota apart from most opt-in states is that it does not start from zero. Since 2016, the state has run the Partners in Education program, created by SB 159 and codified at SDCL Chapter 13-65, which channels contributions to scholarship-granting organizations that fund K-12 tuition for eligible families. It is important to be precise about the mechanism: the existing South Dakota program is an insurance-premium tax credit, meaning insurance companies, not individual income-tax filers, receive credits of up to 100 percent of their contributions, subject to a $5,000,000 annual statewide cap, and it is administered by the Division of Insurance within the South Dakota Department of Labor and Regulation. That is a different instrument from the new federal §25F individual credit, but it means the state already maintains an established SGO infrastructure, including a list of approved organizations that route donations into scholarships. The distinction between the two credits is the kind of state-versus-federal detail we unpack in our [explainers](https://eftccredit.com/learn). The federal §25F structure is straightforward: a taxpayer who donates to a qualified SGO can claim a nonrefundable credit of up to $1,700 against federal tax, and the SGO turns those donations into K-12 scholarships for eligible families. To qualify, an SGO must be a 501(c)(3) public charity rather than a private foundation, and income limits apply to the families it serves. The exact mechanism of South Dakota's opt-in, whether through an IRS advance election filed by the state or through enabling legislation, was not specified in the coverage of Rhoden's announcement, a procedural step explained in our reporting on [IRS Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025). What is clear is that South Dakota was later confirmed on the IRS roster of participating states published June 8, 2026 in [IR-2026-76](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026), which listed more than half the states and a per-taxpayer credit of up to $1,700. For organizations weighing whether to receive credit-eligible donations in South Dakota, the head start matters. The state already has a working pipeline of approved scholarship-granting organizations under the Partners in Education program, so existing operators are well positioned to add the federal §25F channel rather than build donor-intake and scholarship-award machinery from scratch. They do not have to assemble that machinery alone: there is software purpose-built for running a §25F program end to end, and the current national landscape of organizations is catalogued in our [SGO directory](https://eftccredit.com/sgos). The practical takeaway for donors is unchanged from every other state: the federal credit does not function until qualified SGOs are in place to receive contributions and award scholarships, and standing up that federal-side process is the next step before 2027. South Dakota now joins a fast-growing group of states acting on the federal credit, from [Virginia's early opt-in](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026) to [Florida's](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026) and [Colorado's](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025). Its distinguishing feature is the pre-existing, insurer-funded scholarship channel that gives the state an unusual running start on SGO infrastructure, even though that older program operates through a different tax mechanism than the new individual credit. Whether South Dakota's established organizations move quickly to stand up the federal §25F side, and how robust a donor base they build before the January 2027 launch, is what will determine what families and donors in the state actually receive, and it is detailed on the [South Dakota state page](https://eftccredit.com/states/south-dakota). Sources: - Dakota News Now: Rhoden says state will opt into federal education tax credit program (Nov. 14, 2025): https://www.dakotanewsnow.com/2025/11/14/rhoden-says-state-will-opt-federal-education-tax-credit-program/ - IRS IR-2026-76: More than half the US states signed up to participate in the federal scholarship tax credit program (June 8, 2026): https://www.irs.gov/newsroom/more-than-half-the-us-states-signed-up-to-participate-in-the-federal-scholarship-tax-credit-program-enacted-under-the-one-big-beautiful-bill - SD Dept. of Labor and Regulation, Division of Insurance: Partners in Education Tax Credit Program: https://dlr.sd.gov/insurance/tax_credit_program.aspx - Ballotpedia: Larry Rhoden (party and office confirmation): https://ballotpedia.org/Larry_Rhoden Canonical: https://eftccredit.com/news/south-dakota-rhoden-opts-in-25f-november-2025 ### Nebraska was the first state to commit to the federal §25F credit, signing Executive Order 25-14 in September 2025 Date: 2025-09-29. Category: state-action. State: NE. On September 29, 2025, Nebraska Governor Jim Pillen signed Executive Order 25-14, titled "Federal Scholarship Tax Credit," opting his state into the new federal Scholarship Tax Credit (FSTC / §25F), the program created in the One Big Beautiful Bill that President Trump signed in the summer of 2025. The Republican governor announced the move at St. Teresa Catholic School in Lincoln, joined by U.S. Reps. Adrian Smith and Mike Flood. Under §25F, individual taxpayers can direct up to $1,700 to a qualified Scholarship Granting Organization (SGO) and claim a dollar-for-dollar federal tax credit, with the scholarship dollars flowing to families earning up to 300% of area median income. The credit becomes available January 1, 2027, which means Nebraska's participation enables school-choice scholarships beginning that year. The move made Nebraska the first state in the country to commit to the new credit, months before the IRS published the advance-election form that states would later use to formally opt in, and well ahead of the wave of opt-ins that followed. It is worth being precise about the mechanism. The executive order is the state's action: it signals Nebraska's intent to participate and directs the relevant agencies to begin building the program. The federal side of opting in is effected separately through the IRS, via an advance election (later formalized on [Form 15714](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025)), with each participating state's certified SGO list due to the IRS by January 1 of the program year. In other words, signing the order is the start of the process rather than the finish. Nebraska's Department of Revenue has stood up a dedicated §25F SGO information page, but SGO certification is not yet open: the application forms and procedures remain pending. Until those are published and organizations are certified, no donations can actually be routed and no scholarships awarded. For SGO founders and donors, that gap between the election and a working program is the part worth tracking. An opt-in is the easiest step; the credit only functions once qualified SGOs exist to receive donations and award scholarships, and in Nebraska that infrastructure is still being built. Operators weighing whether to establish one of Nebraska's first SGOs should watch the Department of Revenue's certification timeline closely, because early movers will be positioned to receive donations the moment the program goes live in 2027. The current status for every state, including Nebraska's pending certification process, is detailed on our [Nebraska state page](https://eftccredit.com/states/nebraska) and the [national participation map](https://eftccredit.com/states), and founders can review how the organizations work and what compliance requires in our [explainers](https://eftccredit.com/learn). Nebraska's first-mover status set a marker that other states measured themselves against. In the months that followed, [Virginia](https://eftccredit.com/news/virginia-first-to-opt-in-youngkin-spanberger-january-2026), [Colorado](https://eftccredit.com/news/colorado-governor-polis-opts-in-december-2025), [Florida](https://eftccredit.com/news/florida-governor-desantis-opts-in-january-2026), and others opted in through a mix of executive action, legislation, and veto-override fights, and by mid-2026 the [IRS had published an official list of states that filed advance elections](https://eftccredit.com/news/irs-official-list-27-states-advance-election-june-2026). Nebraska's path was the cleanest of them: a single executive order, no veto drama, and a governor aligned with the program from the start. The open question now is execution. Whether Nebraska builds a robust SGO network or lets certification drift will determine how many families actually benefit when the credit goes live. Founders looking to be among the first to run a §25F program can see the current national landscape in our [SGO directory](https://eftccredit.com/sgos). Sources: - Office of Gov. Jim Pillen press release: Surrounded by Students, Gov. Pillen Signs Order Opting Into Federal Scholarship Tax Credit (Sept. 29, 2025): https://governor.nebraska.gov/surrounded-students-gov-pillen-signs-order-opting-federal-scholarship-tax-credit - Nebraska Executive Orders official index (confirms EO 25-14 title and date): https://govdocs.nebraska.gov/docs/pilot/pubs/eoindex.html - Nebraska Dept. of Revenue §25F Qualified Elementary and Secondary Education Scholarships information page: https://revenue.nebraska.gov/internal-revenue-code-ss-25f-qualified-elementary-and-secondary-education-scholarships-information - Nebraska Public Media: Gov. Jim Pillen says Nebraska will opt in to federal scholarship tax credit program: https://nebraskapublicmedia.org/en/news/news-articles/gov-jim-pillen-says-nebraska-will-opt-in-to-federal-scholarship-tax-credit-program/ Canonical: https://eftccredit.com/news/nebraska-pillen-first-to-commit-executive-order-25-14-september-2025 ### Ohio Already Runs an SGO Regime: How Its Attorney General Certification Coordinates With the New Federal $1,700 Credit Date: 2025-08-22. Category: analysis. State: OH. Ohio enters the federal §25F era with something most states lack: a Scholarship Granting Organization regime that has been running since 2021. Under Ohio Revised Code 5747.73, the state offers a dollar-for-dollar nonrefundable income-tax credit for cash donations to certified SGOs, worth up to $750 for a single taxpayer and up to $1,500 for a married couple filing jointly. What makes Ohio distinctive is not that it has a tax-credit-scholarship program (many states do) but where the certification authority sits: the Ohio Attorney General's Office, through its Charitable Law Section, certifies SGOs and publishes the official certified-organization list at charitable.ohioago.gov. That is an unusual home for a school-choice function, which in most states lives with the department of revenue or education. The new federal Education Freedom Tax Credit, a one-for-one credit of up to $1,700 per taxpayer for cash SGO contributions, arrives on top of this existing structure when it launches January 1, 2027. The word to watch is "coordinates," not "stacks." The federal §25F credit does not simply layer on top of Ohio's $750/$1,500 credit so that a donor pockets both in full on the same gift. Under the federal rules, if a taxpayer claims a state credit on a qualifying SGO contribution, the §25F credit is reduced dollar-for-dollar by the amount of that state credit, and the same dollars cannot also be taken as a §170 charitable deduction. In practice, an Ohio donor who claims the full $1,500 state credit on a contribution would see the available federal credit on that gift reduced accordingly. Donors who want to maximize the federal $1,700 may need to structure separate contributions, or weigh which credit delivers more value given that the Ohio credit is nonrefundable and capped well below the federal figure. We walk through the federal cap itself, and why it is $1,700 rather than $3,400, in our explainer on [what the §25F statute already settles](https://eftccredit.com/news/1700-not-3400-what-the-25f-statute-already-settles-may-2026). There is also a divergence in who and what qualifies. The federal program requires a state to opt in by filing an advance election on IRS Form 15714 under Rev. Proc. 2026-6, the executive route the IRS laid out when it [published Form 15714 in December 2025](https://eftccredit.com/news/irs-form-15714-advance-election-december-2025). Federal §25F also limits scholarships to students whose family income is below 300% of area median income, an eligibility test that Ohio's own statute does not impose in the same terms. So an organization certified by the Ohio Attorney General as an SGO under ORC 5747.73 is not automatically a qualified SGO for federal §25F purposes, and a scholarship that satisfies Ohio's program may not satisfy the federal income ceiling. Operators will be running two overlapping but non-identical rulebooks, and the certification page that confirms Ohio's federal participation is the same Attorney General resource that lists state-certified SGOs. Ohio's status and the broader national picture are tracked on our [Ohio state page](https://eftccredit.com/states/ohio) and the [national participation map](https://eftccredit.com/states). For SGO operators, the takeaway is that Ohio is fertile ground but procedurally dense. The certification function belongs to the Ohio Attorney General's Office as an institution, which persists regardless of who holds the office, so organizations should not pin their planning to any individual office-holder. The practical work is compliance: tracking which donors claim the state credit versus the federal credit, verifying the federal 300%-of-area-median-income eligibility, and keeping the §170 interaction straight so donors are not double-counting the same dollars. None of that has to be built by hand. There is software designed specifically for the §25F workflow, including the donor-credit coordination and eligibility verification that Ohio's dual regime makes especially fiddly, and existing organizations are listed in the [SGO directory](https://eftccredit.com/sgos). How the credit works, who can found an SGO, and what certification entails are covered in our [explainers](https://eftccredit.com/learn). Looking ahead, Ohio is a useful preview of a question every opt-in state will face: how a pre-existing state scholarship credit coordinates with the federal one. The mechanics that reduce the federal credit when a state credit is claimed will shape donor behavior in every state that already runs its own program, not just in states fighting over whether to participate at all. Ohio's experience, layering a 2021 state statute under a 2027 federal credit administered through an Attorney General's charitable division, will be watched by operators and donors well beyond its borders as the first full year of §25F donations approaches. Sources: - Ohio Attorney General Charitable Law: Certified Scholarship Granting Organization List (confirms AG certifies SGOs): https://charitable.ohioago.gov/Scholarship-Granting-Organization-Certification/List - Ohio Revised Code 5747.73 (statutory basis, AG certification, nonrefundable $750/$1,500 credit): https://codes.ohio.gov/ohio-revised-code/section-5747.73 - EdChoice: Ohio Tax-Credit Scholarship Program overview ($750/$1,500, ORC 5747.73, launched 2021): https://www.edchoice.org/school-choice/programs/ohio-tax-credit-scholarship-program/ - IRS: Federal Scholarship Tax Credit (FSTC) overview: https://www.irs.gov/government-entities/federal-state-local-governments/federal-scholarship-tax-credit-fstc - Brownstein: Federal Scholarship Tax Credit Q&A guide (state credit reduces federal credit on the same gift): https://www.bhfs.com/insight/federal-scholarship-tax-credit-qa-guide/ - Ballotpedia: Dave Yost (Republican, Ohio Attorney General): https://ballotpedia.org/Dave_Yost Canonical: https://eftccredit.com/news/ohio-attorney-general-sgo-regime-meets-federal-25f-credit-august-2025 --- ## For SGO operators Operators who want to start or run an SGO and accept the federal credit are pointed to SGO Software, the companion product from the same publisher. It is built for the federal §25F credit rather than adapted from a state tax-credit tool, and runs donor payments, family eligibility, school disbursement, and §25F federal reporting as one system, at roughly a 3% transaction fee on donations, inside the statute's 10% administrative cap. https://sgosoftware.com ## About Publisher: ECCA Credit, LLC. Contact: info@eftccredit.com. Canonical domain: https://eftccredit.com. Map: https://eftccredit.com/llms.txt. Sitemap: https://eftccredit.com/sitemap.xml.