Faith & Philanthropy | Editorial
Is Giving to an SGO the Same as Church Giving?
Millions of religious Americans give faithfully to their church, their community, and their cause. A new federal tax credit is raising a question they haven’t had to ask before. The answer might change how they give forever.
The envelope goes in the plate every Sunday: Same time. Same fold. Same quiet certainty.
For millions of American families, giving to their church is an act of conscience more than a financial decision. A rhythm of life. It doesn’t require a tax form. It doesn’t ask for a return. It simply asks: “Do you believe in something larger than yourself?”
So when a new kind of giving vehicle emerges — one backed by federal law, carrying a dollar-for-dollar tax credit, routed through a scholarship granting organization (SGO) rather than a collection plate — the first question on the lips of the faithful is understandable.
“Is this still giving? Or is this something else?”
It is a fair question. And it deserves a direct answer.
What an SGO Actually Is
A scholarship granting organization, at its core, is a nonprofit that connects private donations to educational opportunity. Specifically, it collects contributions from individuals and directs them toward scholarships for K–12 students. By law, at least 90 cents of every dollar goes directly to children’s education.
SGOs are not corporations or government agencies. They are 501(c)(3) charitable organizations — the same designation held by hospitals, food banks, and most houses of worship. They are required by law to be transparent, accountable, and student-focused.
The AFC Scholarship Fund is one such organization. As the scholarship arm of the American Federation for Children, the nation’s largest school choice advocacy organization, it exists for a single purpose: to ensure that a family’s zip code does not determine the quality of their child’s education.
The Credit That Changes the Calculus
Beginning January 1, 2027, a new federal mechanism changes the stakes entirely. The Education Freedom Tax Credit (EFTC) — the first federal school choice tax credit in American history — allows any eligible taxpayer to make a charitable contribution to a qualified SGO and receive a dollar-for-dollar reduction in their federal tax liability when they file. This is up to $1,700 per taxpayer.
The distinction matters. A deduction reduces your taxable income. A credit reduces your actual tax bill, dollar for dollar, after the fact. You donate first. The credit follows when you file.
“Approximately 90% of American students are eligible for scholarships funded through this program. The question isn’t whether it reaches your community. The question is whether your community reaches back.”
So Is It Still Giving?
Here is where theology and tax law find each other.
None of these traditions require giving to be economically irrational to be spiritually valid.
The church plate still asks you to give from your resources. So does the SGO. The church plate funds ministry, community, and mission. The SGO funds tuition, books, and a child’s trajectory. The church plate does not give you a federal tax credit. The SGO now does.
But here’s the thing: many of the families who receive scholarships through SGOs are already in your congregation.
Those who benefit are people such as the single mother who drives 40 minutes each way because the school that honors her faith is across town. They are the family that chose to forego a second income so one parent could be present. They are the grandparent raising grandchildren on a fixed income who prays, every August, that the scholarship comes through.
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.
What Makes It Different — and Why That Matters
Church giving and SGO giving are not identical. They’re not supposed to be. But they rhyme.
SGOs are federally-regulated nonprofits. Your contribution is a charitable donation — the same category as your church gift. The EFTC is not a redirect of taxes you already owe. It is a credit that follows a charitable act. You give first. The government acknowledges the gift when you file and credits your donation dollar for dollar.
SGOs also allow you to designate your gift. The AFC Scholarship Fund offers fund structures aligned with faith-based education, Catholic schooling, Jewish education, community schools, and special needs students.
The Numbers That Make This Real
Nationally, the scale dwarfs anything the faith community has previously been able to coordinate. More than $1.6 billion in scholarships have already been awarded through state-level SGO programs nationwide. Approximately 350,000 students have been served. With the EFTC activating in 2027 as the first federal-level program, analysts project millions of new scholarship opportunities becoming available annually.
What the Community Is Starting to Say
The question of SGO giving is surfacing in congregation halls, in Sunday school classrooms, in CPA offices where faith-conscious clients are asking their advisors the same thing: “Wait. I can give to education scholarships and get my money back at tax time?”
Most stewardship advisors will tell you: these gifts are not the same bucket. The tithe sustains the community of faith. The SGO gift extends its mission into the world. The EFTC makes the SGO gift effectively cost-neutral for many households — the credit offsets the donation dollar for dollar — it does not require families to choose between the two.
It is a new category of giving. One that lives alongside the tithe, not in competition with it.
The Envelope, Revisited
There is something profound in the simplicity of the collection plate. No paperwork. No deadlines. No calculators. Just the act of giving.
The Education Freedom Tax Credit will require a little more: a contribution to a qualified scholarship granting organization, a record of that donation, and a line on next year’s tax return. It asks slightly more of you administratively. What it returns is a child in a school that fits, a family with options they didn’t have, and a community living out its values beyond its four walls.
Is it the same as church giving?
“Not identical. But the spirit is unmistakable. It is giving that costs you little and changes someone else’s everything.”
Disclaimer: This article is for informational and educational purposes only and does not constitute tax, legal, or financial advice. Tax laws are subject to change. Please consult a qualified tax professional regarding your individual circumstances. The Education Freedom Tax Credit is effective January 1, 2027. Contribution limits and program details are subject to IRS guidance and final program rules.