The Internal Revenue Service (IRS) announced that 27 states have voluntarily joined the Federal Scholarship Tax Credit (FSTC) program, which allows eligible taxpayers to claim a federal tax credit for contributions supporting elementary and secondary education scholarships. This significant participation marks a key step in the program enacted under the "One, Big, Beautiful Bill."
Under the FSTC program, taxpayers can claim a federal tax credit of up to $1,700 by contributing to qualified Scholarship Granting Organizations (SGOs) located in participating states. These SGOs provide scholarships for qualified elementary and secondary education expenses, with state election and submission of SGO lists being mandatory for participation.
IRS Chief Executive Officer Frank J. Bisignano expressed optimism, saying, "It’s encouraging to see that 27 states have already signed up to participate in this program that promotes and supports elementary and secondary education. We are hopeful that additional states will decide to participate." States like Alabama, Alaska, Florida, Texas, and Virginia are among those that have formally opted into the program.
The IRS will continue to maintain and update the official list of participating states as they complete the necessary election and submission processes, anticipating further expansion of the program.