More than half the states have indicated to the IRS that they will participate in the new federal Education Freedom Tax Credit program that begins Jan. 1 and is projected to direct billions of dollars in taxpayer donations to private and public school services through student scholarships.
Even though rules for the program are not yet finalized by the U.S. Department of the Treasury and the IRS, states and the scholarship-granting organizations that will manage the scholarships can rely on proposed and temporary guidance as they prepare for the program's launch.
Only states that opt into the Republican-led program can participate, and in addition to the 30 states that have formally told the IRS they are interested, at least two other states — New York and New Mexico — have publicly announced they will also take part in the first national school choice program.
The midterm elections saw five state governorships — Georgia, Iowa, Nevada, Ohio and Texas — flip from Republican to Democrat and some state legislative chambers also gain Democratic majorities. This blue wave could affect which states ultimately participate in the federal school choice program.
States must inform the IRS by Jan. 1 of their election into the program and finalize their decision to participate by Feb. 15 with their submission of approved scholarship-granting organizations. Those SGOs will manage and distribute student scholarships.
These 30 states have told the IRS, as of Oct. 22, that they will participate in the Education Freedom Tax Credit program:
Alabama
Alaska
Arkansas
Colorado
Florida
Georgia
Idaho
Indiana
Iowa
Kansas
Kentucky
Louisiana
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
North Carolina
North Dakota
Ohio
Oklahoma
South Carolina
South Dakota
Tennessee
Texas
Utah
Virginia
West Virginia
Wyoming
