Donald Trump’s first year in the White House has brought considerable changes to many aspects of life for citizens in the United States. A provision of the One Big Beautiful Bill, recently signed into law by the President, will create the country’s first federal tax credit for donations to private schools. This IRS program will allow Americans to claim a $1,700 credit to contribute to scholarship organizations for low- and middle-income families.
Opinions are divided between those who support this change and those who do not
The fact is that with this new measure, the credit would be limited to $1,700, according to authorities. Specifically, Education Week, a nonpartisan education news organization, estimates that the new tax credit scholarship program would disproportionately invest more money in private schools than in public schools. For this reason, opinions are divided between those who support this change and those who do not. Meanwhile, the IRS and the Treasury Department issued Revenue Procedure 2026-6 on Friday, which allows all states and Washington, D.C., to participate in a new tax credit that will be offered starting January 1, 2027.
According to experts, the new program would invest five times more money than the annual funding of the consolidated K-12 grant program
In relation to the above, according to 2021 census data, public school enrollment reached 65.1 million students, while private school enrollment reached 14.4 million. According to experts, the new program would invest five times more money than the annual funding of the consolidated K-12 grant program for public schools, and at least 20 times more than the country currently allocates to the largest investment in charter school options, according to Forbes.
For contributions to be eligible for the credit, the SGO must be listed by one or more states during the calendar year
The fact is that with this new benefit, in 2027, individual taxpayers will be able to claim a non-refundable federal tax credit for cash contributions to Scholarship-Granting Organizations (SGOs) that serve elementary and secondary school students from low- and middle-income families. According to official data, for contributions to be eligible for the credit, the SGO must be listed by one or more states during the calendar year.
These accounts are generally used for elementary and secondary education
There are other ways to pay for private schools so that students can still access education. A tax-advantaged savings account to help finance your child’s education is a 529 plan. These accounts are generally used for elementary and secondary education (private, public, and religious), depending on the state, as well as for college. According to Forbes, parents can use up to $10,000 per year per student for tuition, fees, room and board, books, and school supplies.
Educational Researcher concluded that attending a private school doesn’t offer long-term academic benefits
While the $1,700 loan won’t be available until 2027, other changes will be implemented in 2026. Although the focus should be on ensuring everyone has access to education, attending a private school doesn’t always guarantee a better education, or at least that’s what experts say. Specifically, a study published in the journal Educational Researcher concluded that attending a private school doesn’t offer long-term academic benefits.
Based on the information we have so far, the Trump administration has frozen nearly $7 billion in public school funding, stating that the funds were “under review.” It is therefore important to closely monitor developments surrounding this issue, especially since it directly impacts the education and future of students who aspire to higher education.