Tennessee opens a preliminary interest form for its §25F SGO list, with the formal application due later this fall

Tennessee has started taking names. On October 8, the Tennessee Department of Education updated its scholarship granting organizations page to say that organizations "interested in inclusion on the Tennessee approved list of scholarship granting organizations can now complete the preliminary interest form," and that "a formal application will be released later this fall." Until this week the same page said federal regulations "have not been finalized" and that little was known about how the program would run. It now points to the rules Treasury released on October 1. Questions go to SGO.Questions@tn.gov.

Who builds the list. Tennessee wrote the job into statute. The Federal Tax Credit Scholarship Act (SB 2206), which Gov. Bill Lee signed on April 14 and which became Public Chapter 720, directs the commissioner of education to elect into the federal credit and requires the department to "certify and submit to the secretary of the treasury of the United States and publish on the department's website a list of scholarship granting organizations that meet the requirements of § 25F" and "are located in this state." The act lets the department set "the process and documentation necessary" to get listed by rule, under the state's Uniform Administrative Procedures Act, and bring in other agencies such as the Department of Revenue. Tennessee is already on the IRS roster of states that filed an advance election (our coverage of the act).

What the application can and cannot ask. The formal application is where Tennessee's process takes shape, and Treasury's temporary regulations, which take effect without a comment period and apply from September 1, 2026, draw its edges. A state must require organizations to meet its general rules for charities, including whatever it takes to do business and solicit contributions in the state, and must require "application, documentation, and financial reporting requirements that are reasonably tailored" to the federal tests and to catching fraud, such as two awards paying for the same student's same expense. It cannot go further. A state "may not require SGOs to operate in a manner that is more restrictive than" §25F, "such as by limiting the type of school that scholarship recipients may attend or the types of qualified elementary or secondary education expenses for which scholarship funds may be used." And the department has to certify that its list includes every organization located in Tennessee that asks to be on it and meets the requirements. There is no discretionary cut. The full text is in our archive of the temporary regulations.

"Located in this state" does not mean headquartered here. Under the same rules, an organization is located in a state if it is authorized to do business there and complies with the state's general laws for charities, "including provisions for transparency, accountability, and fraud prevention." No Tennessee office or staff is required, so national and regional SGOs can seek a place on the list next to Tennessee-based groups. An organization on more than one state's list is a multistate SGO under Treasury's proposed rules: it must meet the 85% scholarship-activity test and keep a separate §25F account for each state. Whoever runs it, money raised for Tennessee funds students who live in Tennessee. Scholarships follow the student's residence, and a Tennessee resident may use one at a school across the state line.

The calendar. Tennessee's 2027 election is completed only when its list reaches the IRS, and the federal deadline is February 15, 2027. Without a list, no organization qualifies in Tennessee for 2027 (the full calendar). Groups still forming have an earlier date to watch: if a state lists organizations whose 501(c)(3) applications are still pending, the federal rules require that the exemption, once granted, take effect on or before January 1 of the list year. Tennessee now joins Alaska, which approved its first 20 organizations on October 2, and Kentucky, which has taken declarations since July, among the states collecting names for 2027.

The homeschool line. Tennessee's act says listed SGOs may fund "any qualified elementary or secondary education expense, including home school expenses, to the extent allowed under federal law." The last clause carries the weight. Treasury's proposed rules leave the meaning of "school," and with it whether home-school costs qualify, to separate section 530 guidance that has not been issued yet (where homeschool stands).

For organizations. If you want to fund Tennessee students in 2027, fill out the department's preliminary interest form and watch its page for the formal application. The federal groundwork doesn't wait on Tennessee. Until an organization files its first report with the IRS, a state may rely on its governing documents and written policies, but only if they expressly require the federal operational rules, so write those in now. Set up the §25F segregated account, and register in the IRS SGO portal when it opens; it hasn't yet. Our free SGO Builder covers getting on a state list. We track Tennessee's process on Tennessee's SGO page, every state's official list at /sgos/approved, and the state's status on the Tennessee page.