The FSTC brings new private investments into New York communities with scholarship funding for students in public and non-public schools. Send a letter to Governor Hochul and encourage her to follow through with her stated intention to opt in to the program.
What Is the FSTC and Who Could Use FSTC Scholarships?
The 100% Federal Scholarship Tax Credit in 3 simple steps:
The Federal Scholarship Tax Credit law allows individual taxpayers beginning on January 1, 2027 to receive a 100% dollar for dollar tax credit against federal individual income taxes for donations made to eligible nonprofit scholarship granting organizations (SGOs). These organizations can then provide scholarships for a wide variety of eligible educational expenses to support K-12 students in public and non-public school settings.
Taxpayers can donate up to $1,700 annually to SGOs.
But in order for students to benefit from these scholarships, federal law gives discretion to governors of states (or duly authorized state officers or entities) to decide whether their respective states will participate in this program. State participation requires that a governor allows designated SGOs to grant scholarships in their state, commonly referred to as “opting in.”
All students in public and non-public schools from households with incomes up to 300% of the area median family income are eligible to benefit. The income ceilings for 2026 are provided by the U.S. Department of Housing and Urban Development here.
Scholarships supported by “qualified contributions” could fund tutoring, technology, special education services, enrichment programs, transportation, tuition, and other eligible educational expenses described in section 530(b)(3)(A), known as Coverdell education savings accounts.
Why Should New York Opt-In to the FSTC?
The federal scholarship tax credit will:
- Bring significant new educational investment into New York communities with scholarship funding for students in public and non-public schools.
- Support students across a wide range of educational settings: district public schools, charter public schools, independent schools, and religious schools.
- Expand access to tutoring, enrichment, after-school programs, and specialized services.
- Enable parents and guardians to access the schools and programs they determine best meet their children’s needs.
Keep in mind:
- There is no cost to state or school district budgets; rather, this measure puts money that would otherwise go to the federal government into the hands of families to be spent on their children’s education.
- Failure to opt in will result in millions of dollars in New York taxpayer donations benefiting children in other states whose governors do opt in, since taxpayers can give to any eligible SGO in any participating state.
- According to Education Reform Now, if just 15% of eligible New York taxpayers make annual donations of $1,700 and take the tax credit, more than $750 million will be available for K-12 students; at 30%, the amount grows to $1.5 billion plus, and so on.
A broad coalition of organizations and leaders across the country, in both Republican and Democrat-led states, have already said yes and are working to implement the program. Colorado Governor Jared Polis became the first Democratic governor to officially opt his state into the federal tax credit in January.
In early May, Governor Kathy Hochul publicly announced support for the program, however she also said she is waiting for the Treasury Department’s regulations before she makes her support official, so we cannot afford to take a New York State opt-in for granted.
How to Join the Coalition
We are currently inviting organizations and leaders across the state to join the New York Coalition for Educational Opportunity. Individuals and organizations can easily demonstrate their support by contacting Governor Hochul’s Office via the Coalition to urge the Governor to follow through with her stated intention to opt in to the program. Simply complete the participation form below and fill out the letter below to inform her office of your support. Coalition members help demonstrate broad statewide support for the program by agreeing to have their organization’s name and/or logo included on Coalition materials.
Coalition participants can further support advocacy efforts by:
Participation may look different for each organization, and Coalition members are encouraged to engage at the level that best fits their mission and capacity. Together, we can help ensure New York families gain access to the life-changing educational opportunities made possible through the federal scholarship tax credit. We are currently inviting organizations and leaders across New York State to join the New York Educational Opportunities Coalition. Together, we can help ensure New York families have access to the opportunities made possible through the federal scholarship tax credit.
Join the Coalition
The New York Coalition for Educational Opportunity is a growing statewide alliance of schools, scholarship programs, working families, community leaders and businesses dedicated to ensuring New York State opts into the new Federal Scholarship Tax Credit (FSTC) program designed to benefit all low- and middle-income families with school age students from Montauk to Plattsburg to Buffalo.
Join us in bringing hundreds of millions of new education dollars from charitable donations into New York to support public, private, and charter school students and families — and all at no cost to the state budget. Our goal is simple: get New York to officially say YES and do so immediately so that families, schools, and scholarship organizations can fully prepare for its effective date of January 1, 2027.
The New York Coalition for Educational Opportunity
