Posted on 01/28/26
New York, NY - Jan. 28, 2026 - Yesterday, the Trump administration announced that 23 states have officially opted in to the Federal Scholarship Tax Credit (FSTC), marking a major milestone for school choice nationwide. In addition, other states such as Colorado have publicly announced their intention to opt in, bringing the program within reach of nearly half the country.
The Federal Scholarship Tax Credit was passed by Congress and signed by President Trump on July 4, 2025, as part of the Working Families Tax Cuts Act. Starting in 2027, the FSTC allows individual taxpayers to contribute to a nonprofit scholarship granting organization (SGO) and receive a dollar-for-dollar tax credit worth up to $1700. The SGO then pools the funds and distributes scholarships to eligible students for a wide range of K-12 educational expenses including private school tuition However, in order for SGOs to be approved, the state in which they are located must opt in to the tax credit and include them on a list sent to Treasury.
“Today’s announcement brings the Federal Scholarship Tax Credit closer to reality for families. Every state that opts in means more families gaining access to real educational choices for their children,” said Rabbi A. D. Motzen, Agudath Israel of America’s national director of government affairs. “Agudath Israel will continue working with advocates nationwide to encourage additional governors to opt in, ensuring that all children regardless of where they live, can benefit from this historic opportunity.”