Virginia has become the first state in the United States to formally opt into the Education Freedom Tax Credit, also known as the Federal Scholarship Tax Credit (FSTC), according to an announcement by Governor Glenn Youngkin. The program is designed to encourage individuals and businesses to donate funds for K–12 scholarships, thereby expanding school choice options across the state.
Governor Youngkin stated, “Virginia is proud to lead the nation once again as the first state to opt in to the Education Freedom Tax Credit. This decision expands school choice for families across the Commonwealth by opening access to federally tax credit-funded scholarships, empowering parents and helping ensure students, especially those with the greatest needs, can choose the learning environment that is right for them. Thank you President Trump, Secretary Bessent, and our congressional leadership in the House and Senate for delivering school choice across America.”
United States Treasury Secretary Scott Bessent commented on Virginia’s participation: “Every child, no matter their zip code, deserves a great public, charter, or private school their parents choose for them. President Trump’s Working Families Tax Cuts delivered on this and the largest expansion of education freedom in history. I am pleased to support Governor Glenn Youngkin, who announced that Virginia has opted into the program. Virginians will join the many Americans who are excited about the Education Freedom Tax Credit and supportive of educational choice.”
Starting January 1, 2027, taxpayers participating in this program can claim a nonrefundable federal tax credit of up to $1,700 per year for contributions made through approved Scholarship Granting Organizations (SGOs). These scholarships may be used for tuition at private schools or public schools offering specialized programs, tutoring services, educational therapies for students with disabilities, and other education-related expenses.
As part of its formal participation in FSTC effective January 1, 2026, Virginia submitted an initial list of eight SGOs—two based in Virginia and six national organizations—to serve eligible students when the program launches in 2027. The list may be updated as further federal guidance becomes available.
Secretary of Education Aimee R. Guidera said: “We know that one-size-fits-all education doesn’t work. This is why Governor Youngkin has prioritized more quality options for families to choose from – whether it be by expanding access to college course through dual enrollment and CTE opportunities that lead to industry-recognized credentials, or our growing network of lab schools. Participation in the Education Freedom Tax Credit will make it possible for our families who don’t have the financial means to now have the ability to participate in tutoring and other enrichment programs with a fee through our public schools, as well as getting tuition assistance to attend a private school if that is the best place for their child. Virginia benefits when every student is in a learning environment in which they thrive.”
The state government will continue working with federal agencies such as Treasury and IRS as more details about implementation emerge.
Since taking office, Governor Youngkin’s administration has focused on broadening educational choices by establishing new Lab Schools through partnerships between colleges and local organizations; restructuring charter and Governor’s School processes; providing transportation flexibility; and making dual enrollment accessible statewide.
The Education Freedom Tax Credit aims to further expand these efforts by giving more families—including those whose children attend public schools—access to additional educational resources starting in 2027.
More information about eligibility requirements and guidance on state participation can be found through resources provided by the United States Department of Treasury and the Internal Revenue Service.
