EFTC in New Mexico
New Mexico has declined to participate in the federal scholarship tax credit program. Also known as the Federal Scholarship Tax Credit (FSTC), the program was enacted as IRC §25F and takes effect January 1, 2027.
- Governor
- Michelle Lujan Grisham
- Democrat
- Status
- Declined
- As of 2026-01-27
- Program begins
- January 1, 2027
- Federal tax credit live
What New Mexico's decision means
Governor Michelle Lujan Grisham announced on 2026-01-27 that New Mexico will not opt in to the federal Educational Choice for Children Act (EFTC). Unless the decision is revisited, New Mexico will not designate Scholarship Granting Organizations (SGOs), and New Mexico families will not be eligible for EFTC scholarships when the program begins on January 1, 2027.
Donors in New Mexico, like donors anywhere in the country, can still claim the federal tax credit (up to $1,700 per tax return) by giving to SGOs in states that have opted in. The federal tax dollars they redirect will fund scholarships for students in other states rather than staying in New Mexico.
The decision is not necessarily permanent. Governors can update their states' participation each year by submitting a list of qualifying SGOs to the U.S. Treasury by January 1.
Frequently asked questions about EFTC in New Mexico
Does New Mexico participate in EFTC?
No. Governor Michelle Lujan Grisham has stated that New Mexico will not opt in (announced 2026-01-27). Unless the decision is reversed, New Mexico families will not be eligible for the scholarships.
Who is the governor of New Mexico and what is their position on EFTC?
Governor Michelle Lujan Grisham (Democrat) has stated the state will not participate.
Can New Mexico residents donate to an SGO and claim the federal tax credit?
Beginning January 1, 2027, any U.S. taxpayer can claim a federal income tax credit of up to $1,700 per tax return for donations to a qualifying Scholarship Granting Organization, regardless of the state they live in. Because New Mexico is not currently participating, donations from New Mexico residents would need to go to SGOs in opted-in states, funding scholarships for students in those states rather than in New Mexico.
When does the EFTC program begin?
The Educational Choice for Children Act program begins on January 1, 2027. Donations made on or after that date are eligible for the federal tax credit. Each participating state's governor must submit a list of qualifying Scholarship Granting Organizations to the U.S. Treasury by January 1 of each participating year.
Becoming an SGO in New Mexico
New Mexico has not opted into the federal §25F credit, so there is no SGO certification pathway here yet. If New Mexico opts in, an organization would need to meet the federal requirements that apply in every participating state:
- Be a 501(c)(3) nonprofit that is not classified as a private foundation.
- Spend at least 90% of the income you receive on scholarships, the remaining 10% is the only budget for all administration, including fundraising.
- Award scholarships to 10 or more students who attend more than one school.
- Do not earmark or reserve contributions for a specific, named student.
- Serve students in households at or below 300% of area median gross income.
- Appear on your state's certified SGO list, which the state submits to the U.S. Treasury.
Follow New Mexico’s status above, and see how to start an SGO to prepare in the meantime.
Scholarship Granting Organizations in New Mexico
Our directory tracks the Scholarship Granting Organizations running today’s state tax-credit scholarship programs, the organizations most likely to administer the federal EFTC once official §25F lists are certified.
Browse the national SGO directory →Other states with the same status
States that have also declined.
Recent New Mexico EFTC / FSTC news
Coverage of New Mexico’s Federal Scholarship Tax Credit decisions and developments.
Learn more about EFTC
In-depth guides on how the program works, who qualifies, and how to participate.
- The real obstacle isn't politics, it's adoptionOnce a state opts in and the program is live, the question that decides whether the Education Freedom Tax Cred…
- Get the credit in your paycheck, not the refundMost people assume a January 2027 donation means waiting until the April 2028 refund to see the $1,700 back, r…
- The CPA's guide to §25FA practitioner's reference to IRC §25F (the EFTC / ECCA / FSTC): the $1,700 dollar-for-dollar credit, why it w…
- Year-end planning: which December mattersThe Education Freedom Tax Credit takes effect January 1, 2027, which turns the usual year-end playbook upside …
- The EFTC, explained for your communityA plain-language, forward-it-to-anyone explainer of the new federal scholarship tax credit: what it is (up to …
- Designating your gift to a schoolSection 25F bans earmarking a donation for any particular student, and that ban is exactly as wide as it sound…
Make your voice heard in New Mexico
Contact Governor Michelle Lujan Grisham and let them know that New Mexico families want access to EFTC scholarships when the program begins January 2027.
Contact Governor Grisham →
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