On Oct. 1, the U.S. Treasury and the IRS released the rules for the education freedom tax credit, the first federal scholarship tax credit in our country’s history. It is a monumental moment for education in America. Beginning Jan. 1, 2027, taxpayers can give up to $1,700 to a scholarship-granting organization and receive a dollar-for-dollar federal tax credit. Married couples filing jointly can claim a combined credit of up to $3,400.
Those gifts will fund scholarships for K-12 students from families earning up to 300% of their area’s median income, and Treasury estimates that about 96% of children in participating states will be eligible. Thirty states have opted in so far, and more are expected to follow. Just as important, the rules make clear that states cannot add requirements stricter than federal law or use discretionary standards to shut out qualifying organizations.
Most importantly, these rules affirm our nation’s commitment to parent choice. I began my career teaching kindergarten at St. Pius Catholic School in Jacksonville, Florida. I later served as an early childhood director and principal and spent eight years at Step Up For Students before joining Odyssey. I have seen what changes when families can afford the education they want for their children. In Key West, Florida, families advocated to bring back a Catholic high school that closed in 1986. When the Basilica School of St. Mary Star of the Sea reopened its high school in 2023, 16 families enrolled their children in its first ninth-grade class. That growth only lasts when families, donors, and schools trust the program behind it.
My Catholic faith and years in Catholic education taught me to take stewardship seriously. In the classroom and as a principal, parents trusted us with what mattered most: their children. That trust shaped my responsibility to families. Stewardship means recognizing that what we have been given is not ours alone and caring for it well.
The education freedom tax credit asks the same of every scholarship-granting organization. Families are trusting them with their tax returns and pay stubs. Donors are trusting them with their gifts. Lawmakers are trusting them with a program many advocates worked years to pass.
The proposed rules put that stewardship into practice. Every organization must register with the IRS through a new online portal, send donor acknowledgments by Jan. 31, 2027, report contributions to the IRS by Feb. 28, 2027, and complete an annual financial and programmatic audit. These safeguards protect the program and the families it serves.
Treasury expects that by 2030, more than 11 million taxpayers will give $26 billion a year, funding as many as 2 million full-time scholarships through 600 to 700 organizations. Many scholarship-granting organizations preparing to launch in January will serve thousands of students across several states and hear from thousands of donors in the first weeks. At that size, every requirement multiplies, and manual processes will not keep up.
This program is new, and we will learn as we go. Existing state programs offer lessons. In Florida, I saw how scholarships made tuition affordable and helped Catholic schools grow. At Odyssey, we support education choice programs in many states across the country and have seen a catalytic impact in Texas in just the first year of its program. The lesson across all programs is simple: accountability works best when it is built in from the start. That means having systems to manage donations, verify eligibility, and meet reporting deadlines as the program grows. A trusted technology partner can help large organizations grow without losing the accountability families, donors, and lawmakers expect.
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Some of the proposed requirements will be challenging to put into practice. Scholarship-granting organizations should read the rules closely and submit feedback before the comment period closes on Dec. 1. They should ask any potential technology partner, including Odyssey, how its systems will help them meet each requirement. Our goal should remain clear: getting scholarships to families promptly while following the rules.
As a mother, I know how much this choice matters. Parents are the first and best educators of their children, and every family deserves a school that meets their child’s needs. The education freedom tax credit can help bring that opportunity to families across the country. Caring for it well is how we make sure it lasts.
Lauren May is Head of Education Freedom Tax Credit and Partnerships at Odyssey. She is a former Catholic school teacher and principal, spent eight years at Step Up For Students, and received the 2025 NCEA Leonard F. DeFiore Parental Choice Advocate Award.