In the next segment of this series, ACTE will take a closer look at the school voucher provisions included in H.R. 1, the One Big Beautiful Bill Act. The purpose of this provision is to make private and religious K-12 schools more accessible.
At the heart of the provision is a dollar-for-dollar federal tax credit that fully reimburses donors for the first $1,700 they contribute to non-profit organizations that provide tuition vouchers. These scholarship-granting organizations help families pay for private school tuition, opening new options beyond traditional public schools.
Unlike the original House version of the bill, which capped the total tax credit at about $5 billion per year, the final version does not include an overall limit on the total amount of tax credits that can be claimed.
Eligibility for these scholarships is also targeted. Students whose family income does not exceed 300% of their area’s median gross income can qualify for aid through these scholarship-granting organizations.
States play an important role in how this new program works. First, states may opt-out of the program completely. If a state chooses to participate, it must oversee the scholarship organizations that receive donations and distribute the tuition vouchers to students. This means states would be responsible for vetting these groups to ensure they meet program requirements and deliver scholarships appropriately.
Supporters of the provision argue that it will increase educational options for families, especially for lower- and middle-income households that want alternatives to local public schools but struggle to afford tuition. Critics, meanwhile, raise concerns about public dollars indirectly supporting private and religious education, and how this may affect funding for public schools.
This provision goes into effect starting with the 2027 tax year, and regulations will have to be drafted to determine how the program will operate.
ACTE sent a letter to the Senate Finance Committee on June 12 asking the committee to reject school vouchers in the bill and will be monitoring the implementation closely.
ACTE will continue to post about the various provisions included in the One Big Beautiful Bill Act. If you have any questions or would like to discuss this more in-depth, please contact ACTE’s Government Relations Manager, Jimmy Koch (jkoch@acteonline.org).
