23 States on Track to Forfeit Over 4 Million Potential Scholarships

Washington, D.C.—Today, America First Policy Institute (AFPI) released an interactive calculator that projects significant financial and educational losses for states that reject the Education Freedom Tax Credit (EFTC). According to the analysis, the 23 states currently not participating are projected to forego nearly $23 billion in charitable educational donations between 2027 and 2029, resulting in more than 4.1 million lost scholarship opportunities.

The EFTC allows taxpayers to claim up to $1,700 in dollar-for-dollar federal tax credits for contributions to Scholarship Granting Organizations (SGOs). These non-profits fund scholarships that families can use for a range of K-12 educational expenses. However, only students in participating states are eligible to benefit. While taxpayers in non-participating states may still claim the credit, their contributions must be directed to SGOs in other states—sending resources and opportunities elsewhere.

“Every governor who refuses to opt in is turning away millions in educational opportunity for their own students,” said Erika Donalds, Chair of Educational Opportunity at AFPI. “This is a zero-cost, high-impact policy, yet non-participating states are effectively sending those resources to other states instead of supporting their own families.”

The interactive calculator allows users to adjust the percentage of taxpayers that will contribute to SGOs and model funding losses for students across all non-participating states. The tool is built on norms that are designed to produce conservative estimates.

The EFTC Funding Loss Fact Sheet and Calculator can be accessed here.