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New · Jan 2027

Federal Scholarship Tax Credit (2027)

Starting in January 2027, taxpayers can take a federal credit of up to $1,700 for gifts to scholarship granting organizations in states that opt in. Texas said yes on Dec. 10, 2025.

The credit came out of the 2025 federal tax law. A taxpayer who gives up to $1,700 to a certified scholarship organization gets the same amount back as a federal tax credit.

Eligibility is measured against 300% of area median income. Incomes in Hidalgo and Starr counties run below the state average, so nearly every Valley family should fall under the limit, including those placed in TEFA's lower tiers or left on its waitlist.

Locally, the credit could matter most for two groups: high schoolers whose tuition runs past the award, and children who are still waiting for a TEFA account. We'll add Valley-serving organizations here once Texas publishes the certified list.

Combining it with other sources

Valley families rarely rely on one source. This one generally combines with the school's own discounts and scholarships and with at least one other source on our list. The funding check works out the right mix for your child.

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Answer five quick questions and a School Funding Advisor will call with a plan built on your district, your schools and the 2026-27 amounts. Free, in English or Spanish, with no obligation.

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