The Federal Scholarship Tax Credit: What It Could Mean for Our Students
A new federal program could bring expanded educational opportunity to families across New York — including the students and families we serve in Brooklyn and Queens. It offers tuition relief for families at Catholic and other private schools while also funding services that support public school students. But there’s one crucial step: New York only participates if Governor Kathy Hochul opts the state into the program.
How It Works
Any taxpayer who owes federal income tax can claim a 100% federal tax credit of up to $1,700 for donations to nonprofit Scholarship Granting Organizations (SGOs) — organizations like Futures in Education that award scholarships directly to students. That means donors can redirect up to $1,700 of what they’d otherwise pay the IRS toward student scholarships instead — at no net cost to themselves. Because the program runs on private donations rather than government spending, it creates new scholarship dollars without new state costs.
Scholarships can be used for a range of educational needs, including:
- School tuition
- Tutoring
- Special education services
- Educational technology
- Academic supplies and related supports
Who Could Qualify?
Families earning up to 300% of their region’s median income are eligible — broad enough to include more than 90% of K–12 students in many areas, including a great many families right here in Brooklyn and Queens.
Why It Matters
If New York opts in, millions of dollars in privately funded scholarships could flow to students statewide through SGOs like Futures in Education — making tuition more affordable, expanding educational options, and strengthening the long-term stability of our schools. For many of the families we serve in Brooklyn and Queens, a scholarship is the difference between having real educational choices and having none.
The Timeline and the Decision
The credit takes effect on January 1, 2027. To participate, the governor must submit a list of approved SGOs to the U.S. Treasury Department each year — a list that scholarship organizations like Futures in Education could be part of. If New York doesn’t opt in, New Yorkers can still donate and claim the credit, but their dollars will fund scholarships for students in other states instead of our own. The decision rests with Governor Hochul.
Source: New York State Catholic Conference