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In July 2025, President Donald Trump signed into law the first national school voucher program, a decades-long goal of school choice advocates. Set to launch in January 2027, the program offers federal tax credits of up to $1,700 to individuals who donate to scholarship-granting organizations (SGOs). These nonprofits will provide scholarships to families for use at private schools — including religious institutions — as well as for tutoring, transportation, and other education-related expenses.
Key Features
State Participation is Optional: States must opt in to participate. At least 21 states with existing tax credit programs are likely to join, but others, like New Mexico, have already declined over concerns about accountability and impact on public school funding.
Broad Eligibility: Students must be eligible for public school, live in a participating state, and come from families earning up to three times the area median income. This includes many private and potentially home-schooled students.
Uncapped Federal Cost: The law does not cap the total tax credits available. Estimates of cost to the Treasury range from $4 billion to over $50 billion annually.
Flexibility in Use: Funds can be used not only for tuition but also for transportation, special education services, books, computers, and more. Public schools may be eligible to receive payments for some services provided to non-enrolled students.
The law allows wide discretion in implementation, raising key questions for public educators: how state legislatures will respond, how districts might collaborate with nonprofits, and how this could shift enrollment, funding, and service delivery in public schools.
While supporters argue the program increases educational access, critics warn it may divert resources from public schools without equivalent oversight or inclusion. Public education leaders will need to monitor developments closely as states make implementation decisions in the coming months.
For a detailed review of the program, please visit:
The Republican megabill that President Donald Trump signed into law in July will establish new tax credit scholarships for families to use at private schools, including religious ones — a long-held goal of school privatization advocates who argue parents should get taxpayer support if they want to opt out of their neighborhood school.
