The Education Freedom Tax Credit hasn’t even launched yet—it’s set to begin in 2027—and there’s already a legislative effort to repeal it. Thirty-two Senate Democrats have introduced a bill to eliminate the credit before a single family benefits from it.
Politics aside, it’s worth asking a practical question: what would actually be lost if the EFTC went away?
Billions in Scholarship Funding That Never Materializes
The EFTC is designed to unlock billions of dollars in new scholarship funding by incentivizing private donations to scholarship granting organizations. A dollar-for-dollar tax credit of up to $1,700 per donor creates a powerful incentive for individuals to fund educational scholarships through their tax returns.
If the credit is repealed, that incentive disappears. The donations don’t happen. The SGOs don’t get funded. The scholarships don’t get awarded. It’s not that existing funding gets cut—it’s that new funding never comes into existence.
This is the economic reality of repeal: it doesn’t save public money (the EFTC doesn’t spend public money). It prevents private money from flowing to families who need it.
The Economic Reality
The EFTC doesn’t spend public money. Repealing it doesn’t save public money. It simply prevents private money from flowing to families who need it.
18 Million Students Lose Access to New Opportunities
The EFTC targets families earning under 300% of the area median income. According to current estimates, that’s roughly 18 million school-age children whose families would be eligible for scholarships funded through the credit.
These are families for whom educational options—private school tuition, specialized tutoring, special needs services, curriculum materials, technology—are often out of reach financially. The EFTC was designed to close that gap through private philanthropy, not government spending.
Without the credit, those families are left with whatever their current school district provides. For many, that’s excellent. For others—particularly in underserved communities—it means fewer options at a time when educational outcomes are still recovering from years of disruption.
WHAT REPEAL MEANS BY THE NUMBERS
The scale of opportunity that would be lost
18M
Eligible students who lose access to new scholarships
18M
Eligible students who lose access to new scholarships
18M
Eligible students who lose access to new scholarships
Based on EFTC provisions in the Working Families Tax Cuts
29 States Lose a Federal Partner
Twenty-nine states have already indicated they will participate in the EFTC when it launches. Many of these states have their own tax credit scholarships—the EFTC was designed to complement and extend those efforts at the federal level.
Repeal wouldn’t just affect families in those 29 states. It would also eliminate the pathway for the remaining states to participate in the future. The EFTC represents the first federal framework for school choice that works across all 50 states and D.C. Removing it closes a door that just opened.
“The EFTC doesn’t spend public money. Repealing it doesn’t save public money. It simply prevents private money from flowing to families who need it.”
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.
Donors Lose a Dollar-for-Dollar Incentive
For individuals who want to support education, the EFTC is one of the most efficient vehicles available. A dollar-for-dollar credit means your full donation comes back on your tax return, up to $1,700. That’s not a deduction—it’s a credit, which means it reduces your tax bill dollar for dollar.
Without the EFTC, donors can still give to education-focused nonprofits, but without the same level of tax benefit. The credit was specifically designed to maximize the incentive for private giving to K–12 scholarships. Remove the credit, and you remove the incentive structure that makes large-scale private scholarship funding viable.
What’s Really at Stake
This isn’t about one political vote or one piece of legislation. It’s about whether a new mechanism for funding education—one that doesn’t cost public schools a dollar and puts decisions in the hands of families—gets a chance to work.
The EFTC is set to launch in 2027. The infrastructure is being built. States are opting in. SGOs are preparing to distribute scholarships. Families are starting to learn about their options.
The question isn’t whether you agree with every political argument on either side. The question is whether millions of families should have access to scholarship funding that’s paid for by private donors who choose to give. That’s what’s on the table. And that’s what repeal would take away.
No. As of April 2026, 32 Senate Democrats have introduced legislation to repeal the EFTC, but it remains part of the Working Families Tax Cuts and is set to launch in 2027.
No. The EFTC is funded by private donations, not government spending. Repealing it would prevent private money from flowing to families through scholarship granting organizations, but it would not save public funds.
Approximately 18 million school-age children in families earning under 300% of the area median income would lose access to new scholarship funding that the EFTC was designed to provide.
Twenty-nine states have indicated they will participate when the EFTC launches in 2027. Repeal would eliminate the federal framework and close the pathway for remaining states to participate in the future.
Donors would lose the dollar-for-dollar tax credit of up to $1,700 for donations to qualifying scholarship granting organizations. Without this incentive, large-scale private scholarship funding becomes significantly less viable.
Stay informed and sign up at afcscholarshipfund.org for updates on the EFTC, including when it launches and how you can donate to qualifying SGOs to fund K–12 scholarships.
