- Ohio has not yet opted into the new federal private school scholarship tax credit program.
- The federal program offers a $1,700 tax credit for donations to eligible scholarship granting organizations.
- Benefits for donors and students are scheduled to begin January 1, 2027 for participating states.
(OHIO) — Ohio had not opted into a new federal private school scholarship tax credit program as of May 11, 2026, leaving no Ohio group able to launch the benefit for donors under the education provision enacted last year.
Congress enacted the Federal Tax Credit for Scholarships in July 2025 as part of the One, Big, Beautiful Bill, or HR1, and President Trump signed it into law. The measure offers a nonrefundable federal tax credit of up to $1,700 per individual taxpayer for cash donations to eligible Scholarship Granting Organizations, or SGOs, that serve K-12 students from low- and middle-income families.
The credit does not begin immediately. It takes effect on January 1, 2027, for tax year 2027 contributions.
Federal officials cast the program as a broad school choice measure. U.S. Secretary of Education Linda McMahon described it as “the largest national investment in education choice,” enabling “scholarships to children to attend a school of choice or access other education-related services.”
Donors who qualify can claim the credit dollar for dollar, up to $1,700. Any state tax credits claimed for the same donation reduce the federal credit.
Congress did not place a nationwide cap on the total amount of federal credits that taxpayers can claim through the program. That structure sets it apart from some state scholarship tax credit systems that limit total annual awards.
Eligibility rules for Scholarship Granting Organizations are built into the federal program. An SGO must award scholarships to at least 10 students, and those students cannot all attend the same school.
Each eligible organization also must spend at least 90% of its income on scholarships. The law requires SGOs to prioritize families earning no more than 300% of area median gross income or the federal poverty limit.
Students may use the scholarships for private school tuition, tutoring or other education services at participating schools. The program is aimed at K-12 students from low- and middle-income households.
States control whether the federal credit can operate within their borders. A state must elect to participate as a covered state and certify eligible SGOs before donors there can claim the credit for contributions to those organizations.
The Internal Revenue Service set out that process in Revenue Procedure 2026-6, issued on December 12, 2025. The procedure allows advance state elections through Form 15714 submitted on or after January 1, 2026.
States also must submit lists of eligible SGOs by deadlines that the IRS plans to provide in Notice 2025-70. Those lists are central to the program because the federal credit applies only to donations made to approved organizations in participating states.
Ohio had not taken that step by May 11, 2026. Gov. Mike DeWine’s office said in August 2025 that it was reviewing the provision, but no public decision had been announced and no SGO list submission had been made public by Monday.
That leaves Ohio in a holding pattern even though the state already runs a separate scholarship donation credit of its own. Ohio enacted its state Scholarship Donation Credit in 2021 through HB110, sponsored by Sen. Larry Oelslager.
Under that state program, taxpayers can claim up to $750, or $1,500 for joint filers. Ohio Department of Taxation data showed 24,000 returns claimed $26.8 million under the credit in 2023.
The federal credit would sit on top of that state structure rather than replace it. Because the federal credit is reduced by any state credit tied to the same donation, taxpayers would have to account for both when calculating the federal benefit.
State officials and scholarship groups already have an operating model to look to inside Ohio. Ohio SGOs include organizations that fund Gilmour Academy tuition assistance and give priority to low-income families.
Across the state, Ohio SGOs awarded $1.7 million to 600+ students across 80 schools in one recent year. Those figures offer a snapshot of how existing scholarship networks work before any federal layer takes effect.
The practical barrier in Ohio is not the absence of scholarship groups. It is the absence of a state election into the federal system and the certification process required for those groups to count as eligible Scholarship Granting Organizations under the new law.
Timing now matters for state agencies and scholarship providers because the federal credit starts with contributions made on or after January 1, 2027. The IRS already opened the path for advance state elections on January 1, 2026, months before that first tax year begins.
Any Ohio decision would shape whether donors in the state can claim the Federal Tax Credit for Scholarships on their federal returns for contributions made in 2027. Without an opt-in and certified organizations, there is no federal program for Ohio donors to use.
The design of the law also reflects a broad federal reach. Congress allowed credits nationwide without a federal cap, but left the gatekeeping role to states, which means participation can expand unevenly depending on state decisions and certification timelines.
Families that eventually receive scholarships through eligible organizations could use the money beyond tuition alone. The law permits tutoring and other education services at participating schools, widening the set of expenses that a scholarship may cover.
Income targeting is another defining part of the measure. Scholarship Granting Organizations must prioritize families at or below 300% of area median gross income or the federal poverty limit, tying eligibility to lower- and middle-income households rather than opening the benefit without an income screen.
Ohio taxpayers and scholarship groups watching the program still have several dates and documents to track. The federal credit begins with contributions made on January 1, 2027; advance elections through Form 15714 have been available since January 1, 2026; and SGO list deadlines are expected in Notice 2025-70.
Until Ohio elects to participate, the state remains outside the new system created by the One, Big, Beautiful Bill. The federal credit exists in law, but in Ohio, as of May 11, 2026, it remained a program waiting for the state to open the door.
