Scholar Street is an IRS-approved 501(c)(3) public charity — EIN 42-2704061 · Arlington, Virginia · Contributions are tax-deductible under IRC §170.
Why Now

A new federal opportunity
for scholarship giving.

In 2025, Congress created the first federal tax credit for K–12 scholarship donations — the Education Freedom Tax Credit (IRC §25F) — effective January 1, 2027. Scholar Street is registered to operate in multiple states and is building its footprint ahead of the January 1, 2027 launch.

The Credit at a Glance

What makes §25F different.

$1,700
Dollar-for-Dollar

A federal tax credit per taxpayer, not a deduction. Nonrefundable, with a five-year carryforward if your liability is smaller than your gift. Treasury has not yet issued guidance on how the cap applies to joint returns.

Any Taxpayer
No Donor Income Limit

Any individual with U.S. federal tax liability can claim the credit. There is no income ceiling for donors, and no phase-out. Cash gifts only.

300% AMI
Household Eligibility

Scholarship eligibility reaches households up to 300% of area median income — a threshold that includes a wide range of working families.

The Details

How the credit actually works.

A credit, not a deduction
A deduction reduces your taxable income. A credit reduces your tax bill dollar-for-dollar. A $1,700 gift to Scholar Street offsets $1,700 of federal tax owed — money that would otherwise go to the IRS, directed instead to a child’s education.
Nonrefundable, with carryforward
The credit can reduce your federal liability to zero but not below it. If your gift exceeds what you owe in a given year, the unused portion carries forward for up to five years.
Cash contributions only
The federal credit applies to cash gifts. Contributions above the credited amount may qualify as a charitable deduction if you itemize.
Effective January 1, 2027
The credit becomes available for contributions made on or after January 1, 2027. Scholar Street is registered to operate in multiple states and is building its footprint ahead of the launch.
Awards are tax-free to families
Scholarship awards received by families are not treated as federal taxable income.
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