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The Federal Scholarship Tax Credit is leveling the playing field with new opportunities for every child

Education freedom tax credit

Starting Jan. 1, 2027, the Federal Scholarship Tax Credit (FSTC) will allow private donations from individual taxpayers (up to a $1,700 dollar-for-dollar federal tax credit) to be directed to Scholarship Granting Organizations (SGOs) supporting K-12 students.

The FSTC has the power to serve students wherever they are, regardless of their environment — public school, private school, or education at home. Importantly, the program will provide scholarships for eligible students that can be used for approved educational expenses including tuition, tutoring, instructional materials, after-school programming, therapy, and technology.

For this vision of educational freedom to be realized, SGOs and other organizations considering participation will need to be supported with a proven, simple-to-use infrastructure of integrity that works for parents, helps fight fraud and simplify reporting, and handles the complicated compliance and vendor-vetting required by federal law.

How It Works

For SGOs

Learn what becoming an SGO involves.

For Public Schools

The FSTC isn’t only about private schools. An education foundation can become a qualifying SGO and direct scholarship dollars to the students being served within public schools.

For Private Schools

Any public district, charter, private, or faith-based school that provides elementary or secondary education (kindergarten through grade 12) can receive scholarships funded by the FSTC as long as their state has opted into the program.

For Families

Approved funds arrive via direct deposit or automated check, no chasing required.

Statewide programs

31 states have opted in. Is yours one of them?

31 states opted in

Taxpayers can donate beginning in January 2027, but families can only benefit in states that elect to participate: and Governors must opt in each year. Here's where things stand today.

Opted in
Not yet opted in

Hover a state to see its status.

Source: Ballotpedia, as of March 2026. Status changes as governors elect to participate, so keep this map current.

Check your state's eligibility

PER TAXPAYER

$1700

dollar-for-dollar federal tax credit

NATIONWIDE

Uncapped

no limit on total credits

TIMELINE

Jan 2027

program goes live

Built to Serve Section

Why ClassWallet

Built to serve you

ClassWallet offers a turnkey, end to end solution designed to help SGOs raise the money, manage compliance, and facilitate the distribution of funds. Our proprietary payment infrastructure is the only one of its kind offering multi-program wallet technology so that your scholarship recipients can manage EFTC and state-level ESA funds with separate rules using a single login.