Texas Governor Greg Abbott has announced the state’s intention to participate in a new federal tax credit scholarship program, established by President Trump’s One Big Beautiful Bill. The initiative is designed to provide families with greater flexibility in choosing educational options for their children.
“Texas has delivered on its promise to bring education freedom to every Texas family,” said Governor Abbott. “Thanks to President Trump, generous Texans can receive a tax credit for donations to a qualified scholarship granting organization to minimize education expenses for families. This critical program will increase the opportunity for families to choose the educational setting that works best for their child. Texas is proud to partner with the Trump administration to empower parents and ensure a stronger future for our children.”
The One Big Beautiful Bill introduces a dollar-for-dollar federal tax credit of up to $1,700 per year for individuals who contribute to approved scholarship granting organizations (SGOs). Donations exceeding $1,700 can have credits carried forward over five years. Eligible students are those from households earning at or below 300% of the local median income. These students may apply through SGOs for scholarships, which can be used not only toward tuition at public or private schools but also other education-related costs such as tutoring, transportation, or special needs services. States must opt into this program before it begins in January 2027.
Earlier this year, Texas passed Senate Bill 2 creating the Texas Education Freedom Account (TEFA) program. This law enables qualifying students to use allocated funds on various preapproved educational services and providers, including private school tuition and educational therapies. The TEFA program will launch with $1 billion in funding for the 2026-2027 academic year, marking it as one of the largest first-day launches nationally.
