A New Era

Q: How does the new federal Education Freedom Tax Credit work?

Here's the process, step by step:Step 1: You make a charitable contribution to a qualified scholarship granting organization (SGO).Step 2: That contribution generates a dollar-for-dollar federal tax credit of up to $1,700.Step 3: The credit reduces what you owe the IRS when you file your federal taxes.The EFTC is not a deduction. It is a direct reduction of your federal tax liability. You donate first; the credit follows at filing. The program launches January 1, 2027.

In American Education

The Education Freedom Tax Credit is a once-in-a-generation opportunity to expand scholarships for K–12 students. Starting in 2027, eligible donors can claim a dollar-for-dollar federal tax credit of up to $1,700 — so more children can reach the school that’s right for them.

WHAT IS THE EFTC?

For the first time in American history, a federal law lets donors fund K–12 scholarships and get every dollar back.

Starting January 1, 2027, an eligible donor who contributes to a qualified Scholarship Granting Organization (SGO) — like AFC Scholarship Fund — receives a dollar-for-dollar federal tax credit of up to $1,700: a direct reduction of what they owe the IRS, not just a deduction.

Those contributions open the right school to families who’ve had the fewest choices. For the first time, a child’s options aren’t decided by family income or ZIP code — and roughly 90% of American students are expected to be eligible, in every state that takes part.

AFC Scholarship Fund is America’s scholarship network — the most-connected way to put your credit to work. Give up to $1,700, reduce your federal tax bill by the same amount, and open a door for a child. Net-zero cost to you. Life-changing for a family.

Scholarships are funded by private, charitable donations — not taken from public school budgets — and can help cover:

Tutoring and academic support
Special-education services and therapies
Books, technology, and learning materials
Private or faith-based school tuition
Dual enrollment, AP exams, and more

Make a Donation

Starting in 2027, make a charitable contribution to a qualified Scholarship Granting Organization like the AFC Scholarship Fund.

AFC Issues a Scholarship

The SGO awards a scholarship to a student who needs it.

A Student Gets Funded

Funds help cover real education costs — tuition, tutoring, books, and more — putting the right educational opportunity within reach.

Up to $1,700 Tax Credit

When you file, you claim a dollar-for-dollar federal tax credit of up to $1,700 — a credit, not a deduction.

Be the First
to Know

Get notified when the Education Freedom Tax Credit launches so you don’t miss the opportunity to support K–12 students while benefiting from a federal tax credit.

Education Freedom Signup

First Name

Last Name

State

Phone Number

Sign me up to receive text message updates from the AFC Scholarship Fund about school choice and the Education Freedom Tax Credit.

Disclaimer: Opt-in disclaimer: By providing your phone number and submitting this form, you are subscribing/consenting to receive SMS/MMS messages to that number, including donation asks, newsletters, and school choice news from the AFC Growth Fund and AFC Scholarship Fund. Message and data rates may apply. Message frequency varies. Reply STOP to opt-out at any time, reply HELP for help. The AFC Growth Fund and AFC Scholarship Fund are happy to help at 1-800-458-7313. SMS opt-in will not be sold, rented, or shared with any third parties/affiliates unless required by law. You can view our Privacy Policy and Mobile Terms and Conditions here.

Featured Story

From Falling Behind to Team Captain: How School Choice Changed Clay’s Life

Gold Star mother Jessica with her daughters Elizabeth and Caroline

Gold Star Family Finds Relief Through School Choice

When Jessica lost her husband in the line of duty, she became the sole decision-maker for her two daughters. She says the Opportunity Scholarship doesn’t just help with tuition — it gives her back something grief tried to take: the ability to choose.

How School Choice Changed Sam Myers’ Life and Opened Doors for Thousands More

Samuel Myers works two jobs. He has a girlfriend. He started his own card-making business. He even met the President. But more than 30 years ago, none of this seemed possible.

Students at Kingdom Life Academy, a Christian micro-school, engaged in hands-on classroom learning

Kingdom Life Academy: A Christian Micro-School Preparing Students for Real Life

For many low-income families, finding the right school can mean the difference between a child dropping out — or discovering their purpose.

Mya, a Washington School for Girls student, smiling in her school uniform

She Almost Didn’t Go: How School Choice Helped Mya Reach a Top School

One mother’s belief—and the power of school choice—set Mya on a path to one of the top boarding schools in the country.

The Education Freedom Tax Credit (EFTC) is a new federal tax credit that rewards taxpayers who donate to qualified scholarship granting organizations (SGOs). When you make a charitable contribution to a qualified SGO, you receive a dollar-for-dollar federal tax credit of up to $1,700. This reduces what you owe the IRS when you file your taxes. The donation comes first, then the tax benefit follows. The EFTC takes effect January 1, 2027.

The AFC Scholarship Fund is a nonprofit scholarship granting organization (SGO) created to make the Education Freedom Tax Credit work on a national scale. It is affiliated with the American Federation for Children (AFC), the nation’s largest school choice organization. Our mission is to connect donors to students, making it as simple as possible for families to access the education that’s right for their children.

Here’s the process, step by step:
Step 1: You make a charitable contribution to a qualified scholarship granting organization (SGO).
Step 2: That contribution generates a dollar-for-dollar federal tax credit of up to $1,700.
Step 3: The credit reduces what you owe the IRS when you file your federal taxes.

The EFTC is not a deduction. It is a direct reduction of your federal tax liability. You donate first; the credit follows at filing. The program launches January 1, 2027.

Many charitable donations qualify for a tax deduction. These tax deductions simply reduce your taxable income, which means the actual savings are a fraction of what you gave.

For example, if you’re in the 24% tax bracket and claim a $1,700 deduction, you save about $408. That’s it.

A tax credit, on the other hand, reduces your actual tax bill, dollar for dollar. If you donate $1,700 to a qualified scholarship granting organization (SGO) and owe $2,000 in federal taxes, you now owe $300. Your tax liability decreases by $1,700, not $408.

Your state’s participation status does not affect your ability to claim the federal Education Freedom Tax Credit. The EFTC is a federal benefit. What matters is that the SGO you donate to is a qualified organization. Donors can contribute to SGOs in any participating state and still receive the federal credit, regardless of where they live. If your state has not opted in, you can still donate to a qualified SGO. Your federal credit applies all the same.

Credits for donations of more than $1,700 can be carried forward for up to five years.

The Education Freedom Tax Credit launches January 1, 2027, but families are counting on scholarship infrastructure being in place from day one. When donors register their interest now and commit early, they help scholarship granting organizations build the capacity to serve families quickly when the program goes live. Early participation also helps ensure that lower-income families, who need these scholarships most, have access from the start.

Approximately 90% of American students are eligible to receive EFTC scholarships through a qualified scholarship granting organization (SGO). Eligibility is based on household income relative to local area median income. Scholarships become available starting in 2027 when the Education Freedom Tax Credit takes effect.

If you’re wondering whether your family qualifies, register your interest and we’ll help you find out.

Scholarship applications are processed through scholarship granting organizations (SGOs) like the AFC Scholarship Fund. The tax credit takes effect on January 1, 2027.

Be Ready On Day One

The Education Freedom Tax Credit launches in 2027. Join the list and we’ll tell you the moment you can fund a scholarship and claim your federal tax credit.