Updated: This story has been updated to reflect additional state decisions to participate in the federal tax-credit scholarship program.
Twenty-seven states and counting are on track to participate in the first federal program that will direct funds to families so their children can enroll in private schools and cover other expenses outside the public school system.
In four of those states, the new federal program will be the first full-fledged, taxpayer-funded private school choice program.
More state decisions on opting into the newly created federal tax-credit scholarship program are rolling in this month after the IRS formally started letting states enroll in the school choice expansion included in President Donald Trump’s One, Big Beautiful Bill Act that passed Congress last summer.
So far, the governors of 27 states have either formally enrolled or said they plan to at some point. Four governors have said their states won’t participate. The remaining 19 governors and the mayor of the District of Columbia have yet to announce their intentions, according to Education Week’s tracker of state decisions.
Until now, all major private school choice programs have been state-level initiatives. But the federal tax-credit scholarship forces all states and the District of Columbia to decide on private school choice, whether they currently have a program of their own or don’t.
Under the new law, individual taxpayers can claim a dollar-for-dollar federal tax credit of up to $1,700 for donations to nonprofit organizations that then award scholarships to K-12 students that they can use to attend private schools.
Students whose family income does not exceed 300% of their area’s median gross income—a broad pool of potential recipients—are eligible to receive scholarships as long as their state opts into the scholarship program. The federal law does not specify the size of scholarships awarded.
The scholarships could cover a range of expenses specified in federal law. In addition to tuition at private schools, including religious schools, tutoring, school uniforms, technology, after-school programs, transportation, and services for students with disabilities are among the allowed expenses.
Taxpayers can claim credits starting in the 2027 tax year.
What governors are saying about the tax-credit scholarship
Education Week has tracked governors’ announcements on participating in the program and asked their offices about individual state decisions since last summer.
Twenty-four of the 27 states where governors have opted in or are on track to are led by Republicans.
In four of the 27 states—Alaska, Colorado, Nebraska, and North Dakota—the federal tax-credit scholarship will be the first full-fledged private school choice program.
Voters in two of those states opposed private school choice measures in 2024, with Colorado voters rejecting a proposal to enshrine a constitutional “right to school choice” and Nebraska voters repealing a newly passed $10 million allocation for private school scholarships. Alaska has a unique arrangement that directs public funds to families to cover private or home-school expenses, but it doesn’t let them use the money to enroll in private schools full time. Private school choice legislation last year failed in North Dakota.
The other 23 states already have state-level private school choice, and 16 have universal programs—for which all students in the state are eligible or are on track to be eligible in the coming years.
Patrick Wolf, an education policy professor at the University of Arkansas and a school choice expert, expects nearly all states ultimately will opt in.
“If they don’t participate, many of their citizens will make contributions for which they’ll get a federal tax credit, and those dollars will go to students in other states,” he said.
Families will likely be able to layer a federally funded scholarship on top of assistance they receive from any state program, he said.
That’s a point some governors have made in announcing their participation in the federal program.
The federal offering will expand “opportunity even further while reinforcing the state’s commitment to school choice,” Iowa Gov. Kim Reynolds said in early January. Iowa has issued education savings accounts to families since 2023 that they can use for private or home school; families this school year—the first in which all students are eligible—qualify for almost $8,000 in state funds.
The four governors who have said they don’t plan to opt in—of Hawaii, New Mexico, Oregon, and Wisconsin—are all Democrats. Of those states, only Wisconsin has private school choice: four voucher programs that allow some students to enroll in private schools.
“Let’s just do the best we can with our public schools,” Wisconsin Gov. Tony Evers told the Milwaukee Journal-Sentinel in September. “We have plenty of voucher schools. We don’t need voucher money.”
Some governors who haven’t said whether they’re opting in—including Democrats Maura Healey of Massachusetts and Josh Shapiro of Pennsylvania—told Education Week through spokespeople that they’re first awaiting federal regulations from the U.S. Department of the Treasury that will iron out more specifics.
Some Democrats have said they hope public school students might be able to benefit from the funds.
Colorado Gov. Jared Polis, a Democrat, said he would “be crazy not to” opt in.
“Fundamentally, it’ll empower more parents to be able to afford that after-school program or the summer program that they want for their kid,” he told the Colorado Sun in December.
Only two Republican governors—Kelly Ayotte of New Hampshire and Phil Scott of Vermont—have yet to announce their intentions. Their offices didn’t respond to requests for comment.
Questions remain about the federal program
How exactly the federal tax-credit scholarship program will be structured in each state is still unknown.
There’s no budgetary ceiling on it, and it’s uncertain how many taxpayers will claim the tax credits that bankroll the scholarships, so the total cost is unknown. Then, it’s uncertain how many students will seek the awards.
Beyond that, it’s unknown how much control states will have: Will they be able to set rules for the organizations giving out scholarships, ensuring public school students can benefit or that only lower-income students receive scholarships? Could states require that private schools taking the scholarships accept all students, regardless of religion, sexual orientation, or gender identity?
“It’s unclear in the statute how much authority individual states will have to to regulate” the scholarship-granting organizations, Wolf said.
Wolf sees a system ultimately in which funding for private and home school could more closely resemble college financial aid, with students drawing from multiple funding sources to pay.
Tricky politics in some states will influence opt-ins
Some Democratic governors face complicated political dynamics in their states around opting in.
In Wisconsin, where Evers has declined to participate in the federal program, the Republican-controlled legislature has approved a bill requiring that the state opt in. And in Kentucky, where Democratic Gov. Andy Beshear hasn’t indicated his plans, Republicans who hold veto-proof legislative majorities have proposed similar legislation.
In North Carolina, Democratic Gov. Josh Stein vetoed legislation to opt his state in but said he intends to enroll once the Treasury Department issues “sound guidance,” with the hope that the program will help public school students. He could face a veto override before then, however.
And in Virginia, former Republican Gov. Glenn Youngkin enrolled the state just days before he left office earlier this month. The office of his Democratic successor, Gov. Abigail Spanberger, didn’t respond to requests for comment on whether she’d stick with Youngkin’s decision.
Wolf expects most states ultimately to say yes.
“It might take a couple years, but I think we’ll see nearly all states participate in the program,” he said.
