Preparing for the 2027 Education Freedom Tax Credit
Opening Paths to Educational Opportunity
American Scholarship Network is building a trusted, compliance-first way for donors to support K-12 scholarships and for schools to turn new tax credit opportunities into meaningful help for students.
CPA-informed. Compliance-first. Built to serve students.
Up to
$1,700
potential federal credit
Begins
2027
qualifying contributions
The opportunity
A New Opportunity for Students, Donors, and Schools
Beginning in 2027, eligible individual taxpayers may be able to claim a federal income tax credit of up to $1,700 for qualifying cash contributions to approved Scholarship Granting Organizations, commonly called SGOs. SGOs use qualifying contributions to provide scholarships for eligible K-12 students.
Tax deduction
Generally reduces taxable income
Tax credit
Generally reduces tax liability dollar for dollar
Eligibility and results depend on federal law, state participation, SGO approval, the donor's tax liability, and other applicable requirements.
How it works
A Straightforward, Four-Step Process
No tax background required — here is the plain-English version.
01
A state participates
A state participates in the federal program and identifies qualifying Scholarship Granting Organizations (SGOs).
02
A taxpayer contributes
An eligible taxpayer makes a qualifying cash contribution to a listed SGO.
03
The SGO awards scholarships
The SGO awards scholarships through an approved eligibility and award process.
04
A credit may be claimed
If all requirements are met, the taxpayer may claim a federal credit of up to $1,700.
Important facts to know
The federal program begins with qualifying contributions made in 2027.
The contribution must be cash.
The credit is nonrefundable.
Unused credit may be carried forward for up to five years, subject to applicable rules.
The federal credit is reduced by the value of any state tax credit received for the same contribution.
Donors cannot earmark contributions for a particular student or family.
Donors should consult their own tax advisor.
For Donors
Turn Tax Liability Into Scholarship Opportunity
ASN is preparing to help donors support eligible K-12 students through a compliant SGO structure while receiving the tax credit benefits allowed by law.
Build Scholarship Capacity Without Building It Alone
ASN helps schools prepare for scholarship funding without requiring school leaders to become tax credit experts, donor administrators, eligibility reviewers, and compliance officers.
A single, coordinated model built around donor trust and school simplicity.
Donor Education
Plain-English materials that help donors understand the opportunity and their responsibilities.
School Campaign Support
Practical guidance for schools introducing the opportunity to their own donor communities.
Scholarship Applications
Structured application workflows for families seeking scholarship consideration.
Eligibility Review
Consistent review of applications against written eligibility and priority policies.
Award Administration
Organized handling of scholarship approvals, notifications, and disbursement steps.
Donor Acknowledgments
Timely, accurate contribution documentation donors and their advisors can rely on.
Fund Tracking
Separate tracking of scholarship funds and administrative funds.
Compliance Documentation
Recordkeeping designed around applicable program requirements.
Impact Reporting
Transparent reporting on how contributions translate into scholarship support.
Ongoing Readiness Support
Continued guidance as federal and state requirements are finalized and implemented.
Our approach
Trust Requires More Than Good Intentions
ASN is being designed around responsible scholarship operations and careful documentation.
Contributions cannot be earmarked for a particular student.
Awards follow written eligibility and priority policies.
Scholarship money is used only for qualified educational expenses.
Donor, applicant, award, approval, and payment records are maintained.
Scholarship funds and administrative funds are tracked separately.
Student and family information is protected.
ASN retains control and discretion over scholarship awards.
At least 90 percent of applicable program income must be used for qualifying scholarships when required by law.
Federal and state guidance will be monitored as implementation develops.
General educational information, not individualized tax or legal advice.
Who this may help
Who Scholarships May Help
Federal eligibility generally includes K-12 students who meet each of the following.
General eligibility factors
Are eligible to enroll in a public elementary or secondary school
Live in a participating state
Meet applicable household income requirements
Complete the required scholarship application and review process
Federal law generally uses a household income limit of no more than 300 percent of area median gross income, subject to final rules and implementation guidance.
Potential qualified expenses
Tuition and fees
Books and supplies
Academic tutoring
Special-needs services
Certain school-related technology
Other qualified K-12 education expenses allowed by law
Not every expense, student, or application is guaranteed to qualify. Final eligibility depends on applicable law and program rules.
About ASN
Built for Clear, Practical Execution
American Scholarship Network is being developed as a CPA-informed, compliance-first scholarship operations organization. ASN is beginning with Ohio and nearby communities, with the goal of building a clean, repeatable model that can serve more students and schools over time.
Trust
Every process is built to be documented, transparent, and defensible.
Practical Support
Schools and donors get clear next steps, not tax-code jargon.
Educational Opportunity
Every decision is measured against one question: does this help a student?
Referral partners
Help Your Clients and Community Prepare
ASN is building relationships with trusted professionals who can help donors and schools understand the opportunity responsibly.
A Scholarship Granting Organization, or SGO, is an approved organization that receives qualifying contributions and awards scholarships to eligible K-12 students according to written eligibility and award rules.
A tax deduction generally reduces the amount of income subject to tax. A tax credit generally reduces the tax owed dollar for dollar, up to applicable limits.
The federal program begins with qualifying contributions made in 2027.
Eligible individual taxpayers may be able to claim a federal credit of up to $1,700 per year for qualifying cash contributions, subject to applicable requirements.
Eligible individual taxpayers who make a qualifying cash contribution to an approved SGO in a participating state may be able to claim the credit, depending on their tax liability and other requirements.
No. Donors cannot earmark contributions for a particular student or family. The SGO controls and directs how scholarships are awarded.
Donors may generally express a preference for a school or community of interest, but the SGO retains control and discretion over individual scholarship awards.
Federal eligibility generally includes K-12 students who are eligible to enroll in a public elementary or secondary school, live in a participating state, meet applicable household income requirements, and complete the required application and review process.
Potential qualified expenses may include tuition and fees, books and supplies, academic tutoring, special-needs services, certain school-related technology, and other qualified K-12 education expenses allowed by law. Not every expense is guaranteed to qualify.
Some states offer their own SGO tax credit programs, which are separate from the federal Education Freedom Tax Credit. If a donor receives a state credit for the same contribution, the federal credit is reduced by the value of that state credit.
ASN is currently building its program and interest lists in preparation for 2027. Do not make a contribution based solely on an expectation of receiving a tax credit. Join the interest list to receive updates about program readiness and applicable requirements.
Yes. This website provides general educational information, not individualized tax or legal advice. Donors should consult their own qualified tax and legal advisors before making a contribution.
Start with the five-step readiness checklist above, or request a school readiness conversation using the form below.
Join the interest list using the forms below to receive updates about program readiness and applicable requirements.
Get involved
Join the Interest List
Tell us a bit about yourself and we'll follow up as ASN's program takes shape.
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Prepare Today. Create Opportunity Tomorrow.
Join American Scholarship Network as we build a trusted path connecting donors, schools, and students.