EFTC news & updates
State opt-in and veto news, IRS rulemaking, and federal legislative activity on the Education Freedom Tax Credit (EFTC), also known as the Educational Choice for Children Act (ECCA) or Federal Scholarship Tax Credit (FSTC), codified at IRC §25F.
Thirteen education groups told Treasury its 90% rule would shut out the nonprofits best placed to run SGOs
There may be no comment period on the §25F rules. Treasury's own paperwork says they take effect the day they publish.
- Analysis
Nearly 92% of American schoolchildren qualify for a §25F scholarship. The first state-by-state numbers are out.
The American Federation for Children published the first state-level estimates of who is eligible for an Education Freedom Tax Credit scholarship: 51.7 million K-12 students, or 91.7% of the country's school-age children. The eligibility test is 300% of area median income, which in most metros clears a family of four earning well into six figures. For anyone building an SGO, this is the demand-side number that has been missing.
- Regulatory / IRS
The IRS roster reaches 30 states, and for the first time the official count matches our map
The IRS refreshed its Federal Scholarship Tax Credit page on July 27, 2026 with a participating-states list current as of July 24. Kentucky is now on it, bringing the official count of completed advance elections to 30. For the first time since the program began, the federal roster and our own participation map name exactly the same 30 states, and New York is the only state left that has announced participation without filing.
- State action
North Carolina named NCSEAA its SGO certifying office, and wrote a deadline that runs on Treasury's clock
North Carolina's §25F opt-in law does something only a handful of states have bothered to enact: Session Law 2026-6 designates the NC State Education Assistance Authority (NCSEAA) as the office that certifies Scholarship Granting Organizations and submits the list to Treasury, and it sets a rulemaking deadline of July 1, 2026 or 120 days after the federal regulations publish, whichever is later. That formula is the plainest statutory proof yet of why every state's SGO process is waiting on Washington.
- State action
Kentucky files its federal §25F election and becomes the first state to open its SGO sign-up
On July 22, 2026, Kentucky Secretary of State Michael Adams completed the state's federal advance election for the Education Freedom Tax Credit (FSTC / ECCA / §25F) and signed a state regulation opening Kentucky's Scholarship Granting Organization declaration process, the first state anywhere to open an SGO sign-up. The move settles the last outstanding veto-override filing and gives Kentucky nonprofits a concrete step to take now.
- Analysis
The biggest risk to the federal scholarship credit isn’t politics. It’s whether people claim it
In a July 2026 Education Next essay, AEI’s Rick Hess, a supporter of the federal Education Freedom Tax Credit, argues that the program’s success turns less on the political fight over state opt-ins than on a quieter question: whether ordinary taxpayers actually claim a credit that pays them back dollar-for-dollar. History says free money often goes unclaimed, and the fixes are operational, not political.
- Analysis
The teachers' unions say “voucher” like it's an insult. Parents say it like it's a lifeline.
The NEA and AFT want the word “voucher” to end the conversation about the federal Education Freedom Tax Credit. It shouldn't. A §25F scholarship is a child getting tutoring, a family getting a choice, a public-school kid getting support their parents couldn't otherwise buy. The real question is why the unions are fighting so hard to stop that.
- State action
Kansas completes its federal §25F election: the IRS roster grows to 29, and Kentucky is now the last override state waiting to file
Kansas, which joined the federal scholarship tax credit in April by overriding Gov. Laura Kelly's veto, now appears on the IRS's official roster of states with completed advance elections. The official count stands at 29, our participation map counts 30, and Kentucky is the one veto-override state whose formal federal filing is still outstanding.
- Analysis
One year in: the federal scholarship tax credit turns one on July 4, and the map has filled in faster than almost anyone expected
President Trump signed the One Big Beautiful Bill Act on July 4, 2025, and buried in it, as section 70411, was §25F, the first-ever federal tax credit for scholarship donations. One year later, 30 states are on the participation map, Treasury has previewed the rules, and the first dollar-for-dollar donations are six months out. Here is where the credit stands on its first birthday.
- Analysis
Six months to launch, and only Virginia has an SGO list on file. Here is why everyone else is waiting, and what to do with the wait.
The IRS's official roster and our participation map now both count 30 states with completed advance elections, yet only one, Virginia, has actually put a list of Scholarship Granting Organizations in front of Treasury. No state has opened an application process any organization can apply through. The pipeline is gated on Treasury's regulations, which leaves operators a narrow, and now predictable, window.
- Analysis
Every child is “eligible” for the federal scholarship. In half the states, homeschoolers still can’t spend it.
Every K-12 child is an “eligible student” under the federal Education Freedom Tax Credit, but the scholarship can only pay for a “school,” and §25F sends that word back to each state. Treasury has now confirmed in writing that home-educated children in roughly half the country are left holding a credit their state’s law won’t let them spend.
- Analysis
The math nobody budgeted for: finding a §25F donor can cost more than the cap lets an SGO spend on everything
A June 30 Chalkbeat report put a number on §25F's least-discussed problem: persuading a taxpayer to make a $1,700 credit donation could cost $300 or more in marketing, while the law limits a Scholarship Granting Organization to spending 10% of what it raises, $170 on that gift, on everything that isn't a scholarship. It is not a reason the credit fails; it is the operating constraint that decides which SGOs make it.
- State action
The biggest prize in §25F is still on the table: a new California resolution urges Newsom to opt in and claim up to $4.9 billion in scholarships
On June 23, 2026, Assembly Concurrent Resolution 229 became the first formal legislative vehicle asking Gov. Gavin Newsom to file California's advance election into the federal Education Freedom Tax Credit (§25F). The measure is non-binding, but it puts a hard number on what the nation's largest state is leaving on the table: up to $4.91 billion in scholarship contributions between 2027 and 2029.
- State action
New Hampshire passes a §25F implementing statute, putting its scholarship-credit machinery on Gov. Ayotte's desk
In June 2026, the New Hampshire legislature gave final approval to House Bill 1774, which directs the Department of Revenue Administration to participate in the federal §25F scholarship tax credit and tasks the Department of Education with building and submitting the state's list of qualifying scholarship granting organizations. Update: Gov. Ayotte signed HB 1774 into law on July 2, 2026.
- State action
Pennsylvania's House overhauls its scholarship-credit programs, and a top Democrat calls the federal §25F credit “intriguing”
On June 22, 2026, the Pennsylvania House voted 105-97 to pass HB 2632, which would retire the state's EITC and OSTC scholarship programs after 2026-27 and replace them with a new roughly $680 million Education Options Tax Credit built around low-income targeting and public reporting. In the same debate, House Majority Leader Matt Bradford signaled rare Democratic openness to the federal §25F credit, calling parts of it “intriguing” as Gov. Josh Shapiro's year-end opt-in decision approaches.
- Analysis
A week after Treasury's §25F preview: what tax advisers are telling clients, and how states are already reacting
Treasury's June 10 preview of the §25F regulations was not a rule, but in the week since it has functioned like one: CPA and tax-law firms have turned it into client guidance, and the preview's signal that states cannot add their own SGO conditions is already shaping what blue states do next.
- State action
Rhode Island's McKee signs the first-in-the-nation law stripping a governor's power to join §25F alone
On June 18, 2026, Gov. Dan McKee signed H7163 into law, making Rhode Island the first state to bar itself from the federal §25F scholarship tax credit unless both the legislature and the governor approve. In a signing statement he called SGO tax credits, in practice, voucher programs, while leaving a narrow door open.
- Analysis
Can Virginia get out of §25F? A Democratic bill to block it stalled, and the real lever is Spanberger's to pull
Virginia was the first state to opt into the federal §25F scholarship tax credit, and Democrats have wanted out ever since. But as of mid-June 2026 the state has not withdrawn: a bill that would have effectively barred participation, HB 359, was carried over to 2027, and the only sure exit, declining to renew the annual opt-in, sits with Gov. Abigail Spanberger, who has not acted.
- State action
Rhode Island passes a first-in-the-nation bill requiring both branches to approve any §25F opt-in, and sends it to McKee
Rhode Island’s General Assembly passed H7163 on June 16, 2026 and sent it to Gov. Dan McKee, a first-in-the-nation bill that would bar the state from joining the federal §25F scholarship tax credit unless both the legislature and the governor approve. McKee has not said whether he will sign it, and the state’s participation remains undecided.
- Analysis
Who's fighting §25F, and on what grounds: the unions, Democrats, and a repeal bill
The federal Scholarship Tax Credit has organized opposition on three fronts, the teachers' unions, Democratic lawmakers, and some state education boards, all built around a single framing: that a tax credit for scholarship donations is a national voucher that drains public schools.
- State action
Maryland is a marquee §25F holdout, and Wes Moore isn't tipping his hand
Governor Wes Moore has declined to say whether Maryland will opt into the federal Scholarship Tax Credit, even as analysts point out the state's own public schools could raise tens of millions by setting up scholarship organizations. The math is favorable; the politics are not.
- State action
Arizona's §25F opt-in died in budget negotiations: the language was in the vetoed GOP tax omnibus but absent from the signed bipartisan budget
Republicans revived Arizona's federal Scholarship Tax Credit opt-in inside their 2026-27 budget tax omnibus, HB 4152, but Gov. Katie Hobbs vetoed the entire GOP budget on May 5. The compromise budget she signed June 13, HB 4168, contains no §25F language at all, cementing that Arizona will have no certified SGOs for the program's January 1, 2027 launch.
- State action
Vermont wants into §25F on its own terms, steering the money toward public schools. The federal rules may not let it.
Vermont's legislature passed a tax bill that opts the state into the federal Scholarship Tax Credit but rewrites who qualifies, limiting eligible organizations to nonprofits serving economically underprivileged students and routing grants toward public and approved independent schools. It's the clearest example yet of a blue state trying to opt in on its own terms, and Treasury's previewed rules suggest states can't.
- State action
Massachusetts stays on the sidelines: Healey awaits Treasury rules as a business coalition and the teachers union clash over the §25F credit
Massachusetts is absent from the IRS's 27-state advance-election roster. Gov. Maura Healey says she is waiting on federal guidance before deciding whether to opt into the §25F scholarship tax credit, while a Peter Lynch-led business coalition presses her to join and the Massachusetts Teachers Association warns it would drain public schools.
- State action
Oregon Gov. Kotek declines §25F after reconsidering, citing Treasury limits on state SGO rules
On June 12, 2026, Gov. Tina Kotek said Oregon will not opt into the federal §25F scholarship tax credit, blaming Treasury's refusal to let states add SGO-specific rules tougher than federal law for leaving the state without the flexibility to participate 'in alignment with our values.'
- Analysis
Floor or ceiling? Treasury's §25F preview signals states can't add their own restrictions
The quiet design fight inside the federal Scholarship Tax Credit is whether federal law is a floor states can build on, or a ceiling they have to take as written. Treasury's June preview pointed to ceiling, and that removes the middle path blue-state governors and the teachers' unions were counting on.
- Regulatory / IRS
Treasury previews the §25F proposed regulations: September timeline, a 90% safe harbor, and a multistate path
Treasury says the §25F proposed regulations will arrive no later than the end of September 2026, and previewed what's in them: a segregated-account safe harbor for the 90% test, a definition of “located in” a state, a path for multistate SGOs, income-verification safe harbors, audit requirements, and a planned IRS portal.
- Analysis
Maine, the state the Supreme Court ordered to fund religious schools, is sitting out §25F
Four years after Carson v. Makin forced Maine to stop excluding religious schools from its tuition program, Maine is one of the few states on the sidelines of §25F, the federal credit that funds private and religious K-12 scholarships. It is absent from the IRS's 27-state roster, its 2026 legislature adjourned without acting, and Gov. Janet Mills has said nothing.
- State action
Wyoming Joins the Federal §25F Scholarship Tax Credit, Moving Gov. Gordon From 2025 'Review' to Participation
Wyoming appears among the 27 states on the IRS's official §25F participation roster released June 8, 2026, completing a path from Gov. Mark Gordon's August 2025 'still reviewing' posture to a submitted advance election that lets donors claim up to $1,700 for gifts to scholarship organizations starting January 1, 2027.
- State action
D.C. sits out the §25F roster: a mayor's call, not a legislature's, and Bowser is on her way out
The IRS's first roster of 27 §25F jurisdictions, published June 8, 2026, includes 27 states and not the District of Columbia. D.C.'s advance election rests with the mayor, and Muriel Bowser, who is not seeking re-election, has taken no action.
- Regulatory / IRS
27 states are on the IRS's official §25F roster, and four states that said yes aren't on it yet
The IRS announced on June 8 that 27 states have formally elected into the federal Scholarship Tax Credit for 2027. Notably absent from the official list: New York, North Carolina, Kansas, and Kentucky, all states that have opted in by announcement or veto override but haven't yet completed the IRS election process.
- State action
After the override, NC's Stein pivots: a Democratic governor's plan to steer §25F donations to public-school students
Governor Josh Stein vetoed North Carolina's opt-in and lost. Now, instead of fighting the federal Scholarship Tax Credit, he says he wants to help North Carolinians route their federally reimbursed donations to scholarship organizations that benefit public-school students, a blueprint for how blue-state governors live with a credit they couldn't stop.
- Analysis
Three governors vetoed, three legislatures overrode: the veto path into §25F
Kentucky, Kansas, and now North Carolina have all joined the federal Scholarship Tax Credit (§25F) by overriding a Democratic governor's veto. With North Carolina's June 3 vote, the legislative-override path is no longer a one-off, it's a recognizable route into the program.
- Analysis
Not a party-line story: where Democratic governors landed on §25F
Colorado's Jared Polis called opting into the federal Scholarship Tax Credit a “no-brainer”; New York's Kathy Hochul signaled intent to join. But Minnesota, Oregon, and New Mexico governors said no. Among Democratic governors, §25F is splitting along lines that aren't purely partisan.
- Regulatory / IRS
Still pending: what Treasury's §25F proposed regulations need to resolve before 2027
States are electing in and SGOs are forming, but the operational rulebook for the federal Scholarship Tax Credit isn't finished. As of June 2026 Treasury has issued advance-election procedures but not the proposed regulations, and several questions that affect donors and SGOs remain open.
- State action
North Carolina Senate completes veto override, NC opts into the federal Scholarship Tax Credit
On June 3, 2026, the North Carolina Senate voted 30-19 along party lines to complete the override of Governor Josh Stein's veto of House Bill 87, enacting the bill into law and opting North Carolina into the federal Scholarship Tax Credit (FSTC / ECCA / §25F). It is the third state to join through a legislative veto override.
- State action
Illinois ends its spring session without acting on §25F, leaving every opt-in bill dead in committee and the decision to Pritzker
The Illinois General Assembly adjourned its 2026 spring session in the early hours of June 1 without voting on any of the three bills that would have opted the state into the federal Scholarship Tax Credit. All three sat in committee and never advanced, leaving any 2027 participation to Gov. JB Pritzker alone.
- Regulatory / IRS
$1,700, not $3,400: what the §25F statute already settles about the credit
As states opt in and the January 2027 launch nears, one detail trips up donors: is the federal Scholarship Tax Credit $1,700 or $3,400 for a married couple? The statute and early IRS signals answer more than many realize, including that you can't double-dip with the charitable deduction or stack it on top of a state credit for the same donation.
- State action
Illinois Senate Republicans press for a §25F opt-in in the session's final week: 'We will be left out and left behind'
In the closing week of Illinois' 2026 spring session, Senate Republicans rallied co-sponsors behind two bipartisan bills to opt the state into the federal Scholarship Tax Credit, warning that donors will go elsewhere if Illinois misses the January 1, 2027 deadline. Both bills remained stuck in the Assignments Committee as the GOP push unfolded.
- State action
Iowa tuition organizations form the Iowa Scholarship Granting Organization for §25F, pitching in-state administration
On May 21, 2026, the Iowa Alliance for Choice in Education announced that existing Iowa School Tuition Organizations have incorporated the Iowa Scholarship Granting Organization (ISGO) to administer the federal §25F tax credit, pitching it as a way to keep administrative fees in Iowa rather than routing them out of state.
- State action
Connecticut's Lamont calls a §25F opt-in “premature,” and wants to see Treasury's rules first
Governor Ned Lamont told CT Mirror he considers opting Connecticut into the federal Scholarship Tax Credit “premature” and prefers to wait for federal guidance, even as neighboring New York signaled it plans to join. Connecticut remains undecided.
- State action
North Carolina House overrides Gov. Stein's veto of FSTC opt-in bill (HB 87)
On May 20, 2026, the North Carolina House voted 73-46 to override Governor Josh Stein's veto of House Bill 87, which would opt North Carolina into the federal Scholarship Tax Credit (FSTC / ECCA / §25F). The Senate must still vote to complete the override; Republicans hold the votes to do so.
- State action
Diocese of Wilmington launches campaign pressing Gov. Meyer to opt Delaware into the federal Scholarship Tax Credit
The Catholic Diocese of Wilmington has stood up a dedicated advocacy campaign (cdow.org/fstc) and a May 19, 2026 pastoral letter from Bishop William Koenig urging Gov. Matt Meyer to opt Delaware into the federal Scholarship Tax Credit before the year-end deadline. It is the first organized, dated, Delaware-specific 25F opt-in effort, and Delaware remains absent from the IRS's list of participating states.
- Analysis
Three states that said no to the FSTC are reconsidering: Hawaii, New Mexico, and Oregon
As of mid-May 2026, Hawaii, New Mexico, and Oregon are the three states whose governors had said they would not participate in the federal Scholarship Tax Credit (FSTC / ECCA / §25F). All three are now reported to be reconsidering ahead of the program's January 1, 2027 launch.
- State action
Illinois public debate over the Federal Scholarship Tax Credit intensifies as Pritzker decision pends
Mid-May 2026 has brought a flurry of Illinois op-eds and lawmaker statements urging Gov. JB Pritzker to opt in, or to stay out, of the federal Scholarship Tax Credit (FSTC / ECCA / §25F) before the program's January 1, 2027 launch. As of May 18, Pritzker has not announced a decision.
- State action
§25F becomes a 2026 Connecticut governor's-race issue as Fazio, calling the credit “literally free money,” wins the GOP nomination
State Sen. Ryan Fazio, the legislature's most vocal proponent of opting Connecticut into the federal Scholarship Tax Credit, won the Republican gubernatorial nomination, setting up a direct contrast with Gov. Ned Lamont, who has called an opt-in “premature.” §25F participation is now a defined issue in the 2026 race.
- State action
Massachusetts coalition of 124 organizations launches to push Gov. Healey into the §25F scholarship tax credit
On May 13, 2026, the Massachusetts Educational Opportunities Coalition launched with 124 member organizations, spearheaded by the National Parents Union, to press Gov. Maura Healey to opt Massachusetts into the federal Education Freedom Tax Credit. Former Lt. Gov. Tim Murray estimated the credit could generate roughly $660 million a year for the state.
- State action
New Jersey Gov. Sherrill won't commit to §25F opt-in, says she will 'evaluate' after Treasury finalizes rules
On May 12, 2026, Gov. Mikie Sherrill's office said New Jersey will evaluate the federal Education Freedom Tax Credit only after the Trump administration finalizes and publishes its rules, leaving the state off the IRS advance-election roster days after neighboring New York signaled it would opt in.
- State action
Colorado Gov. Polis publicly defends his FSTC opt-in at Denver event
On May 9, 2026, one day after New York signaled intent to join, Colorado Gov. Jared Polis appeared at a Denver event to defend his December 2025 decision to opt Colorado into the federal Scholarship Tax Credit (FSTC / ECCA / §25F), saying he doesn't want the state to “leave money on the table.” The remarks followed a state legislative dust-up over anti-discrimination conditions on participating SGOs.
- Analysis
What pending states stand to forgo: a closer look at Pennsylvania
Fourteen states have yet to decide on the federal Scholarship Tax Credit (FSTC / ECCA / §25F). Pennsylvania is one of the most-watched: an advocacy-built impact projector pegs the state's three-year foregone scholarship volume at ~$1.97B if Gov. Josh Shapiro doesn't opt in before the program's January 1, 2027 launch.
- State action
New York Gov. Hochul announces opt-in to Federal Scholarship Tax Credit (FSTC / ECCA)
On May 8, 2026, Governor Kathy Hochul announced New York intends to opt into the federal Scholarship Tax Credit program (FSTC / ECCA / §25F) as part of her FY2027 executive budget proposal. Her office said it will review Treasury guidance before finalizing; if certified, New York families would be eligible for scholarships when the program goes live January 1, 2027.
- State action
Connecticut's only §25F vote of 2026 was a doomed floor amendment. The legislative door is now closed until the governor acts.
A late-night amendment from Sen. Ryan Fazio to opt Connecticut into the federal Scholarship Tax Credit went nowhere during debate on a homeschool oversight bill, and the General Assembly adjourned sine die two days later. With the legislative route closed for 2026, any opt-in now rests entirely with Gov. Ned Lamont, who has called the move premature.
- State action
Tennessee enacts §25F enabling law (Public Chapter 720): DOE to certify SGOs, and homeschoolers are in
On May 5, 2026, Tennessee enacted SB 2206, the Federal Tax Credit Scholarship Act, as Public Chapter 720, directing the Department of Education to elect into §25F, certify scholarship granting organizations, and submit the list to the U.S. Treasury for tax years after December 31, 2026. The act covers homeschool expenses, which the state's own 2025 program excludes.
- State action
Colorado lawmakers kill their own bill to put state guardrails on the §25F SGO list
A Democratic-controlled Colorado House committee voted 11-0 to shelve HB26-1292, the only state bill that would have added nondiscrimination conditions to Colorado's federal Scholarship Tax Credit SGO list. The outcome means the blue state furthest into §25F will enter the program without state-added restrictions.
- Federal action
Senate Democrats introduce bill to repeal the federal scholarship tax credit
A group of Senate Democrats introduced legislation on April 24, 2026 to repeal §25F, the federal Educational Choice for Children Act / Federal Scholarship Tax Credit, citing concerns about diverting federal tax revenue to private and religious schools.
- State action
Oklahoma locks §25F participation into statute: Stitt signs HB 3704, names Tax Commission as SGO administrator
Governor Kevin Stitt approved HB 3704 on April 17, 2026, codifying Oklahoma's election to participate in the federal §25F Education Freedom Tax Credit and naming the Oklahoma Tax Commission as the agency that registers eligible scholarship organizations and maintains the approved list for the U.S. Treasury.
- State action
Arizona Gov. Hobbs vetoes a second FSTC opt-in bill (SB 1142)
On April 14, 2026, Arizona Governor Katie Hobbs vetoed SB 1142, her second veto of a federal Scholarship Tax Credit (FSTC / ECCA / §25F) opt-in bill after rejecting SB 1106 in January. She again pointed to the lack of accountability guardrails and the absence of final federal guidance.
- State action
Kansas legislature overrides Gov. Kelly's veto, opting Kansas into the Federal Scholarship Tax Credit
After Governor Laura Kelly vetoed SB 361 on April 8, 2026, the Kansas legislature overrode the veto during its April veto session, with the House voting 85-38 and the Senate voting 29-10, opting Kansas into the federal Scholarship Tax Credit (FSTC / ECCA / §25F) program. Kansas families will be eligible for scholarships when the program goes live January 1, 2027.
- State action
New Mexico Rep. Rebecca Dow presses Gov. Lujan Grisham on §25F, and the governor is now ‘actively considering’
State Rep. Rebecca Dow (R) sent a public letter urging Gov. Michelle Lujan Grisham to opt New Mexico into the federal Education Freedom Tax Credit, and on April 2, 2026, the governor's office said she is ‘actively considering’ the move while awaiting Treasury guidance, a notable softening from her earlier refusals.
- State action
Wisconsin Gov. Evers vetoes FSTC / ECCA opt-in bill (AB 602)
On March 30, 2026, Wisconsin Governor Tony Evers vetoed Assembly Bill 602, which would have required Wisconsin to opt in annually to the federal Scholarship Tax Credit (FSTC / ECCA / §25F). Wisconsin families will not be eligible for FSTC scholarships in 2027 unless the legislature overrides or the governor reverses course.
- State action
Education Secretary McMahon visits Hamtramck charter school to press Whitmer to opt Michigan into §25F
On March 27, 2026, U.S. Education Secretary Linda McMahon appeared at a Hamtramck charter school to urge Democratic Gov. Gretchen Whitmer to opt Michigan into the federal Education Freedom Tax Credit, warning that without an opt-in Michigan donors' contributions would fund scholarships in other states. Whitmer's office held to its awaiting-federal-guidance posture.
- State action
Minnesota Gov. Walz declines to opt Minnesota into the Federal Scholarship Tax Credit
On March 24, 2026, Minnesota Governor Tim Walz said opting Minnesota into the federal Scholarship Tax Credit (FSTC / ECCA / §25F) is “never going to happen.” His earlier supplemental budget had tied participation to ending longstanding state nonpublic pupil and transportation aid.
- State action
Hawaii lawmakers press Gov. Green to reverse course: four resolutions urge him to reconsider declining §25F
In March 2026, Hawaii’s House and Senate introduced four resolutions urging Gov. Josh Green to reconsider his decision not to enter the state into the federal Education Freedom Tax Credit (§25F). The measures are non-binding, but they put the opt-in question on the legislative record, and because the election is an annual choice, Hawaii’s door stays open.
- State action
A New Jersey bill would order the state into §25F outright: A4777 turns the opt-in from a governor's choice into a statutory mandate
While Gov. Mikie Sherrill weighs whether to opt New Jersey into the federal Education Freedom Tax Credit, a bill introduced March 19, 2026 would take the choice out of her hands: A4777 states that New Jersey “shall participate” and directs the Commissioner of Education to send an SGO roster to the U.S. Treasury. It faces long odds in a Democratic legislature, but it is the first bill to put the opt-in on New Jersey's legislative record.
- State action
Idaho writes its §25F opt-in into permanent statute: HB 731 takes effect July 1, 2026
Idaho moved past Governor Brad Little's February executive order by enacting HB 731, putting the state's participation in the federal Scholarship Tax Credit into permanent statute so it cannot lapse when an order expires. The near-unanimous, bipartisan bill takes effect July 1, 2026.
- State action
In Kentucky, the official who decides which SGOs qualify is not the governor. It is the Secretary of State.
Most states plug into §25F through the governor or the revenue department. Kentucky's House Bill 1, enacted over Gov. Andy Beshear's veto, did something different: it put the state's advance election, its qualifying-SGO list, and the program's rulemaking under Secretary of State Michael Adams, a design built to keep participation out of a hostile governor's hands.
- State action
Kentucky legislature overrides Gov. Beshear's veto of FSTC opt-in bill
Kentucky's legislature overrode Governor Andy Beshear's veto of HB 1 on March 17, 2026, opting Kentucky into the Federal Scholarship Tax Credit (FSTC / ECCA) program despite the governor's objection.
- State action
West Virginia's HB 4588 would put the State Treasurer in charge of §25F: it passed both chambers, then stalled in conference
West Virginia HB 4588 would direct the State Treasurer to run the state's participation in the federal Scholarship Tax Credit, accept SGO applications year-round, and publish a list of qualified organizations by December 1 each year. It cleared the House and the Senate but died in a conference committee when the 2026 regular session adjourned on March 14.
- State action
California students mount a “Purple Postcard” campaign pressing Newsom to opt into the federal §25F scholarship credit
More than 1,100 students at St. Genevieve Parish Schools in Panorama City launched a Purple Postcard Campaign, distributing roughly 15,000 postcards urging Gov. Gavin Newsom to opt California into the federal Scholarship Tax Credit. The Democratic-aligned coalition behind it is unusual, and as of June 2026 California remains undecided.
- State action
Ohio Opts In: DeWine Puts the State Onto the Federal §25F Scholarship Tax Credit
Ohio has made its advance election to join the federal §25F Education Freedom Tax Credit under Gov. Mike DeWine, letting Ohioans claim up to $1,700 in federal credit for donations to qualified scholarship granting organizations starting in 2027.
- State action
New Hampshire opts into the federal §25F scholarship tax credit: Gov. Ayotte announces participation during School Choice Week
Gov. Kelly Ayotte announced on January 29, 2026, that New Hampshire will participate in the federal §25F Education Tax Credit for scholarship granting organizations. Donors can claim a dollar-for-dollar federal credit of up to $1,700 for SGO contributions starting in the 2027 tax year.
- Analysis
Alaska opted in. Its teachers' union says the state constitution's no-aid clause makes that illegal.
After Governor Mike Dunleavy opted Alaska into the federal Scholarship Tax Credit, NEA-Alaska argued the program violates the state constitution's ban on public money for private and religious schools. The state's education commissioner counters that §25F donations are private dollars, not public funds, so no constitutional bar applies.
- State action
New Hampshire opts into the Federal Scholarship Tax Credit under Gov. Ayotte
During National School Choice Week in late January 2026, New Hampshire became one of the first states to commit to the Federal Scholarship Tax Credit (FSTC / ECCA / §25F), opting in by executive action before the legislature moved to codify the state's participation.
- State action
South Carolina opts into the federal Scholarship Tax Credit: Gov. McMaster signs on for 2027
South Carolina Gov. Henry McMaster opted the state into the federal §25F scholarship tax credit, his office confirmed in late January 2026. Donors can give to in-state SGOs and claim the dollar-for-dollar federal credit of up to $1,700 starting January 1, 2027.
- State action
Step Up For Students spins up a dedicated §25F SGO for Florida: the Step Up, Step Further Scholarship Fund
Step Up For Students, the nonprofit that administers Florida scholarships for more than 500,000 students, has created a separate 501(c)(3), the Step Up, Step Further Scholarship Fund, built specifically to act as Florida's federal Scholarship Tax Credit SGO. The largest incumbent operator in school choice is building a purpose-made federal vehicle rather than retrofitting its state apparatus.
- State action
Florida Gov. Ron DeSantis opts Florida into the Federal Scholarship Tax Credit
Florida Governor Ron DeSantis announced on January 28, 2026 that Florida will participate in the Federal Scholarship Tax Credit (FSTC / ECCA / §25F) program, joining the growing list of states opted in for the January 2027 program launch.
- State action
Oklahoma's Stitt Opts Into the Federal §25F Credit by Executive Order and Orders a School Choice Hub
On January 27, 2026, during National School Choice Week, Gov. Kevin Stitt signed Executive Order 2026-03 announcing Oklahoma's participation in the federal §25F scholarship tax credit for 2027 and directing a statewide School Choice Hub within 90 days. The legislature later locked the move into statute with HB 3704.
- State action
Utah opts into the federal Scholarship Tax Credit: Gov. Cox announces the election with no opt-in bill
Republican Gov. Spencer Cox announced in late January 2026 that Utah had elected to join the federal §25F Scholarship Tax Credit, an executive opt-in that needed no legislation. Utah was later confirmed on the IRS roster of 27 participating states, and the credit of up to $1,700 per taxpayer becomes available January 1, 2027.
- State action
North Dakota signals it will join the federal §25F scholarship tax credit: Gov. Armstrong commits the state to the 2027 program
On January 26, 2026, Republican Gov. Kelly Armstrong said North Dakota will participate in the new federal §25F tax credit for donations to Scholarship Granting Organizations. The $1,700-per-taxpayer nonrefundable credit becomes claimable beginning January 1, 2027.
- State action
Alaska opts into §25F by executive action, then admits it has no scholarship organizations and no rush to build them
Gov. Mike Dunleavy opted Alaska into the federal Scholarship Tax Credit on January 26, 2026, doing it administratively rather than through the legislature. The state has no qualified SGOs, no application process, and its own education commissioner says there is no hurry, and Dunleavy will be out of office before the program launches in 2027.
- Analysis
Federal §25F Credit Could Be a Lifeline for Nevada's Starved Opportunity Scholarship Program
On January 23, 2026, Gov. Joe Lombardo opted Nevada into the federal §25F scholarship tax credit, opening a new channel of donor dollars that advocates expect could stack on top of the state's squeezed Opportunity Scholarship program, now capped near $6.65 million a year, down from a $26 million peak.
- State action
Nevada Opts Into the §25F Federal Scholarship Tax Credit: Gov. Lombardo Enrolls the State for 2027
On January 23, 2026, Republican Gov. Joe Lombardo formally enrolled Nevada in the federal §25F Tax Credit Scholarship Program, making the state a covered jurisdiction for the program that launches January 1, 2027 and offers donors a dollar-for-dollar credit of up to $1,700 a year.
- State action
Washington Lawmakers File HJM 4013 Urging Gov. Ferguson to Opt Into the Federal §25F Credit
On January 23, 2026, Washington House Republicans introduced House Joint Memorial 4013, formally asking Democratic Gov. Bob Ferguson to elect Washington into the federal §25F scholarship tax credit and citing a conservative estimate of roughly $732 million in annual donations to Washington SGOs if the state opts in.
- State action
Indiana Opts Into the Federal §25F Scholarship Tax Credit, With Five SGOs Already Lined Up
On January 22, 2026, Gov. Mike Braun announced Indiana would opt into the new federal Scholarship Tax Credit, letting Hoosiers claim a nonrefundable credit of up to $1,700 for donations to qualified SGOs starting January 1, 2027. The state named five Indiana SGOs already planning to participate.
- State action
Montana Opts In to Federal §25F Scholarship Credit, Stacking on Its State SSO Program
Governor Greg Gianforte announced on January 21, 2026 that Montana opted in to the federal §25F scholarship tax credit, letting residents claim up to $1,700 in federal credit for SGO donations starting in 2027 on top of the state's existing Student Scholarship Organization credit.
- Analysis
Why Georgia's $100M State Credit Is Now a Federal §25F Launchpad
Governor Brian Kemp signed Georgia into the federal §25F scholarship tax credit on January 20, 2026, letting donors stack a new federal credit of up to $1,700 per taxpayer on top of one of the nation's largest state tax-credit scholarship programs starting in 2027.
- State action
Georgia opts into the federal scholarship tax credit: Kemp signs the IRS election, GOAL to run the §25F program through a new arm
Gov. Brian Kemp opted Georgia into the federal §25F scholarship tax credit via an IRS advance election on January 20, 2026, and announced it at the Capitol days later. Georgia GOAL will keep running the state credit while a new arm, American GOAL, administers the one-for-one federal credit of up to $1,700 per taxpayer starting January 1, 2027.
- State action
Mississippi Opts Into §25F: Reeves Makes the Election, but the SGO List Is Still Coming
Governor Tate Reeves opted Mississippi into the federal §25F scholarship tax credit on January 19, 2026, making an advance election that lets donors claim up to $1,700 starting in 2027. The state has not yet designated its eligible Scholarship Granting Organizations.
- Regulatory / IRS
Alabama Spells Out Who Can Be a §25F SGO: ALDOR Publishes Certification Criteria
After Governor Kay Ivey opted Alabama into the federal Education Freedom Tax Credit on January 16, 2026, the Alabama Department of Revenue published the rules a scholarship-granting organization must meet to be certified, including a 90% scholarship floor and an Alabama-students-only limit.
- State action
Arkansas Announces It Will Participate in the Federal §25F Scholarship Tax Credit
On January 16, 2026, Gov. Sarah Huckabee Sanders announced Arkansas intends to participate in the new federal §25F scholarship tax credit, which lets individual taxpayers claim up to $1,700 for donations to Scholarship Granting Organizations starting in 2027.
- State action
Alabama Opts Into Federal §25F by Executive Order: Gov. Ivey Signs EO 742
Gov. Kay Ivey signed Executive Order No. 742 on January 16, 2026, confirming Alabama's participation in the federal Education Freedom Tax Credit and tasking the state Department of Revenue with administering it and certifying SGOs. The credit takes effect January 2027.
- State action
Arizona Gov. Katie Hobbs vetoes FSTC / ECCA opt-in bill (SB 1106)
Arizona Governor Katie Hobbs vetoed SB 1106 on January 16, 2026, blocking the state's participation in the Federal Scholarship Tax Credit (FSTC / ECCA / §25F) program. Hobbs cited a desire to wait for IRS regulations before committing.
- State action
Missouri Gov. Kehoe Says State Will Opt Into the Federal Scholarship Tax Credit for 2027
In his Jan. 14, 2026 State of the State address, Republican Gov. Mike Kehoe announced that Missouri will opt into the federal scholarship tax credit (§25F), letting donors claim up to $1,700 in federal credits beginning in 2027.
- State action
Virginia became the first state to opt in, now its new governor will decide whether to keep it
Outgoing Gov. Glenn Youngkin made Virginia the first state to formally opt into the federal Scholarship Tax Credit (FSTC / ECCA / §25F), effective January 1, 2026, days before leaving office. His Democratic successor, Abigail Spanberger, inherited the decision, making Virginia the first test of whether an opt-in survives a change of administration.
- State action
Iowa Opts Into the Federal §25F Scholarship Tax Credit: Gov. Reynolds Makes Iowa an Early Adopter
On January 5, 2026, Gov. Kim Reynolds announced Iowa would opt into the federal §25F scholarship tax credit, effective 2027, making Iowa the sixth state to indicate participation. Donors can claim a dollar-for-dollar federal credit of up to $1,700 for contributions to certified scholarship granting organizations.
- State action
Louisiana Opts Into the Federal §25F Scholarship Tax Credit, and the Senator Who Co-Wrote It Is From Louisiana
On December 17, 2025, Gov. Jeff Landry announced Louisiana would join the federal §25F scholarship tax credit, and Sen. Bill Cassidy, a lead Senate author of the provision, applauded the move the next day. The IRS June 2026 roster confirms Louisiana among 27 participating states for the January 1, 2027 launch.
- Regulatory / IRS
IRS releases Form 15714, states can pre-elect §25F (FSTC) participation
On December 12, 2025, the IRS issued IR-2025-121 and released Form 15714 (Advance Election to Participate), which lets states declare their intent to participate in the §25F Federal Scholarship Tax Credit (FSTC) for calendar year 2027 ahead of submitting their full SGO list.
- State action
Texas opts into the federal §25F scholarship tax credit, layering the $1,700 donor credit on top of its new $1B ESA
Governor Greg Abbott announced on December 10, 2025 that Texas intends to opt in to the federal §25F scholarship tax credit, and the IRS later listed Texas on its June 2026 participation roster. The move stacks the federal $1,700 donor credit on top of the state's brand-new $1 billion Texas Education Freedom Accounts program.
- State action
Colorado Gov. Polis opts Colorado into the Federal Scholarship Tax Credit
On December 5, 2025, Colorado Governor Jared Polis announced Colorado will opt into the federal Scholarship Tax Credit (FSTC / ECCA / §25F) program. In a Colorado Sun interview, Polis called opting in a “no-brainer” and said he would “be crazy not to” take the federal credit for Colorado families.
- Regulatory / IRS
IRS issues Notice 2025-70 requesting public comment on §25F (FSTC) implementation
In November 2025, the IRS issued Notice 2025-70 requesting public comment on implementation of the new §25F Federal Scholarship Tax Credit (FSTC), signaling the start of formal rulemaking ahead of the program's January 2027 launch.
- State action
South Dakota will join the federal §25F scholarship tax credit: Gov. Rhoden opts in with an SGO channel already in place
On November 14, 2025, Republican Gov. Larry Rhoden said South Dakota will participate in the federal §25F tax credit for donations to scholarship-granting organizations, a $1,700-per-taxpayer credit that becomes claimable in 2027. The state already runs a separate, insurer-funded tax-credit-scholarship program, giving it an established SGO infrastructure to build on.
- State action
Nebraska was the first state to commit to the federal §25F credit, signing Executive Order 25-14 in September 2025
On September 29, 2025, Republican Gov. Jim Pillen signed Executive Order 25-14, making Nebraska the first state to commit to the federal §25F Scholarship Tax Credit, months before the IRS even published its opt-in election form. Donors can direct up to $1,700 to a qualified SGO for a dollar-for-dollar federal credit beginning January 1, 2027, though the state has not yet opened SGO certification.
- Analysis
Ohio Already Runs an SGO Regime: How Its Attorney General Certification Coordinates With the New Federal $1,700 Credit
Ohio is unusual in that its Attorney General's Office certifies Scholarship Granting Organizations and the state already offers a $750/$1,500 SGO donation credit. The federal §25F credit does not simply stack on top: claiming the Ohio credit on the same gift reduces the federal credit dollar-for-dollar.
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