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Education Freedom Tax Credit for
Families & Communities

Help Make More Educational Opportunities Possible

Every child deserves the opportunity to learn in an environment where they can thrive.
The Education Freedom Tax Credit (EFTC) creates a new way for communities to help families access K-12 scholarships that allow their children to achieve their dreams.

Whether you’re looking for the right learning environment for your child or want to help make educational opportunities possible for more students, there’s a way to participate.

 

How the EFTC Works for Families

The EFTC connects families with the funds they need to access and afford educational opportunities that best fit their child’s needs.

The Power of Educational Opportunity

Every child learns differently. Parents know their child’s needs, strengths, and circumstances better than anyone. Scholarships can help them access the educational environment and resources that help their child learn, grow, and reach their potential. Through the EFTC, more of those opportunities can come within reach.

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How to Support a Student

Beginning January 1, 2027, eligible individual taxpayers can make qualifying contributions to a Scholarship Granting Organization (SGO), such as ACE Scholarships, and claim a federal tax credit, subject to applicable requirements and individual tax circumstances.

Those contributions help fund K–12 scholarships for eligible students in participating states.

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Why ACE Scholarships?

For more than 25 years, ACE Scholarships has helped families access educational opportunities for their children.

ACE has:

  • Delivered more than 121,000 scholarships
  • Distributed more than $395 million in scholarships and Education Savings Accounts
  • Earned the trust of students, families, schools, and contributors
  • Built proven scholarship systems and infrastructure to support students and communities

Through the EFTC, ACE Scholarships helps turn qualifying taxpayer contributions into scholarships that expand educational opportunities for K–12 students.

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Why Community Participation Matters

Educational opportunity grows when communities come together to support students.

Families

Learn how scholarships can help put more educational opportunities within reach for your child.

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Community Members

Help expand scholarship opportunities for students and families in your community.

Local Business Owners

Help expand educational opportunities for students while investing in the potential of the next generation.

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Grandparents & Extended Family

Help create more possibilities for children, whether they're in your family or your community.

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Alumni

Support educational opportunities for current and future generations of students.

Everyone

Every person who participates can help put more educational opportunities within reach for students.

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Put Possibility Within Reach

You don’t have to be the parent of a scholarship student to help expand educational opportunity.

Learn about the EFTC. Explore scholarship opportunities in your community. If you’re eligible to contribute, prepare to participate beginning January 1, 2027. Then share what you’ve learned with family, friends, neighbors, and others who want to help students thrive.

Help Spread the Word

More families can benefit when more people understand what's possible through the EFTC.

If your state is not participating in the EFTC, use the approved governor email or letter template to encourage state participation.

You can also share EFTC information with others in your community who may want to support K–12 scholarship opportunities.

Every Child Deserves the Opportunity to Thrive

Every child has different strengths and needs. Some thrive in smaller classrooms, while others benefit from specialized instruction, tutoring, or additional resources.

Families deserve access to the learning environment that helps their child succeed. EFTC scholarships can support qualifying expenses, including tuition, tutoring, special-needs services, books, supplies, and equipment.

More access means more opportunities for children to discover what they’re capable of becoming.

Stay Connected

Get updates about scholarships, educational opportunities, and EFTC participation in your state.

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EFTC FAQs

The EFTC is a federal tax credit for eligible contributions to qualified SGOs. Those contributions help fund scholarships for qualifying K–12 educational expenses.

Eligible taxpayers make qualifying cash contributions to participating SGOs. They may then claim a federal income tax credit of up to $1,700 per taxpayer, or $3,400 for married couples filing jointly, for the qualifying contribution, subject to federal requirements and their federal income tax liability.

SGOs use qualifying contributions to provide scholarships that help eligible K–12 students access educational opportunities.

A Scholarship Granting Organization (SGO) is a qualifying nonprofit organization that receives contributions and provides scholarships for eligible K–12 students.

For an EFTC contribution to qualify for the federal tax credit, the SGO must meet federal requirements and be included on the applicable participating state’s SGO list.

Under the EFTC initiative, scholarship funds may be used for expenses incurred in connection with an eligible K–12 student’s enrollment or attendance at a public, private or religious school, including*:

  • Tuition, uniforms, transportation and other fees
  • Books and supplies
  • Academic tutoring
  • Extended day programs
  • Computer technology, equipment, or internet access
  • Educational therapies (e.g., occupational, speech, behavioral, physical)

*as defined by the U.S. Department of the Treasury

Yes. Beginning January 1, 2027, eligible taxpayers in all 50 states with a federal income tax liability can participate in the EFTC and receive a dollar-for-dollar tax credit of up to $1,700 per taxpayer, or $3,400 for married couples filing jointly. However, only states that have opted to participate in the federal tax credit can receive scholarship funding.

Yes. The IRS refers to the EFTC as the Federal Scholarship Tax Credit (FSTC). Both names refer to the same federal tax credit.

The SGO is responsible for administering qualifying contributions and scholarships in accordance with federal requirements. This includes determining student eligibility, distributing scholarships, maintaining required records, and meeting applicable compliance requirements.

A qualifying EFTC contribution must be made to an eligible SGO included on the applicable participating state’s list.