On July 4, 2025, President Donald Trump signed the One Big Beautiful Bill/Working Families Tax Cuts Act into law, and it’s unfortunate that very few parents know this legislation provides the largest national expansion of K-12 education freedom in our nation’s history.
Beginning Jan. 1, 2027, a new federal Education Freedom Tax Credit provides up to $1,700 per individual (up to $3,400 for married couples filing jointly) for qualified cash contributions to a Scholarship Granting Organization. Yet as with most bills passed out of our Congress, there are regulations and deadlines.
On Oct. 1, 2026, the U.S. Treasury Department and Internal Revenue Service released proposed regulations for the credit’s 2027 launch, making the new credit accessible to families and providing administrative guidance for taxpayers, states and SGOs while protecting scholarship funds from fraud and abuse.
SGOs can use contributions from individuals to provide scholarships to students for a range of education-related expenses incurred in connection with a K-12 public, private (including religious) or charter school. This can include tuition for students to attend a school of choice, tutoring for students attending a public school, special education services for students with disabilities, books, supplies and extended day programs.
Why is not this great education freedom opportunity in the headlines during such a consequential midterms election year?
Students from a household whose prior-year income is up to 300% of the area’s median gross income, adjusted for family size, may qualify for a scholarship through the Education Freedom Tax Credit. Our Treasury Department estimates that about 95% of American children live in households that may qualify for such a scholarship.
One challenge for parents in certain states to access these great benefits is that due to an absurd interpretation of U.S. Senate rules by the Senate parliamentarian, senators inserted a state “opt-in” condition for taxpayers in those states to claim the federal credit for contributions to SGOs in their home state.
Yet Treasury reports that as of Sept. 14, 2026, only 30 states have elected to identify SGOs in their state that will be eligible to receive contributions from individuals utilizing the Education Freedom Tax Credit.
Several of the largest population states in the nation with large numbers of underperforming students — including California, Pennsylvania, Illinois, Michigan and North Carolina — have not exercised the opt-in provision.
All of these states have Democratic governors who seem to bend to the will of teachers unions that oppose any support for students to attend nonpublic schools. And it is unfortunate that the teachers unions’ hostility toward education freedom options hits and hurts our nation’s most poor and vulnerable children the most.
Nearly all House Republicans (218-2) voted to provide the Education Freedom Tax Credit in the Working Families Tax Cuts Act. Fifty Senate Republicans and Vice President J.D. Vance voted for the bill; all 47 Senate Democrats and three Republicans voted against it.
The process of enacting and delivering on the benefits of the Education Freedom Tax Credit demonstrates once again that elections have consequences.
Parents in the states that have not yet opted in can, however, seek to persuade their governors to do so by Jan. 1, 2027, and those governors then must submit their eligible SGO lists by Feb. 15, 2027.
Many of those states’ governorships are on the ballot this year, as are every U.S. House seat and 35 U.S. Senate seats, so parents and grandparents have the opportunity to choose education freedom in this election if they want more options for their posterity.
Our midterm elections culminate on Nov. 3, 2026, for voters to decide between candidates who best represent giving all students every advantage available to develop their potential versus candidates who are still selling the narrative of special interest political groups that just a little more taxpayer funds thrown towards public schools will do the trick.
Yes, education freedom is on the midterm ballot.
Photo credit: Gage Skidmore (Creative Commons) – Some rights reserved
Star Parker is the founder of the Center for Urban Renewal and Education and author of “What Is the CURE for America?” She is CURE’s social policy consultant.
