Washington, D.C. — As Americans across the country submit their federal returns this Tax Day, Invest in Education Foundation, an organization with a mission to expand access to quality education across the country, released a new video highlighting how taxpayers can prepare to reduce their 2027 tax liability by supporting K-12 education opportunities for students.
The video breaks down the historic federal tax credit scholarship program; a provision passed in last year’s tax and budget package. Beginning in 2027, the policy allows taxpayers to receive a dollar-for-dollar federal tax credit of up to $1,700 annually when they contribute to qualified scholarship-granting organizations (SGOs).
CLICK HERE TO WATCH VIDEO
The explainer video walks through the program step-by-step:
- Taxpayers who owe federal income tax can choose to donate up to $1,700 to a qualified SGO.
- In return, they receive a 100% federal tax credit, reducing what they owe the government dollar-for-dollar.
- SGOs use those contributions to fund scholarships for students in K-12 education.
- Scholarships can be used for a wide range of educational expenses, including tutoring, education technology, tuition, special education services, after-school programs and more.
For example, a taxpayer who owes $10,000 in federal income taxes and contributes $1,700 to an SGO will reduce their tax bill to $8,300, while helping a student access critical educational support.
These scholarships are funded entirely through private donations. This program empowers parents to access educational resources tailored to their children’s needs in all types of schooling, including public, private, and religious.
Governors have to opt their states in to this scholarship program for families to benefit. Already, 29 states have opted in, moving quickly to unlock new opportunities for their students.
If a governor does not opt in, that state’s taxpayers can still obtain the tax credit by donating to SGOs in other states that have opted in, thus benefiting out-of-state students, while families in their own communities miss out.
To learn more, please visit scholarshiptaxcredit.org.
About Invest in Education Foundation
Invest in Education Foundation is a non-partisan research and policy 501(c)(3) organization that educates the public and policymakers about the new federal tax credit scholarship program as a means to expand educational freedom and opportunity for K-12 parents and students.