Education Freedom Tax Credit: Kansas’ Time Has Come

WASHINGTON, D.C.—Kansas has achieved a veto override allowing Senate Bill 361 to become law and opting the state in to the federal Education Freedom Tax Credit (EFTC). The America First Policy Institute (AFPI) celebrates yet another state bringing education freedom to their families.

The EFTC created by the Working Families Tax Cut Act gives states a tremendous opportunity to expand educational freedom. The law allows taxpayers to claim up to $1,700 in dollar-for-dollar federal tax credits for contributions to nonprofit Scholarship Granting Organizations (SGOs).

“Now Kansas families will benefit from critical scholarships to support the education their kids need,” said Erika Donalds, chair for Education Opportunity at AFPI. “This action by the legislature ensured that Kansans did not watch hundreds of millions of dollars in scholarships walk right out the door. Thankfully those dollars will now stay in Kansas and work for Kansas families.”

According to AFPI’s recently released scholarship calculator, Kansas families could have lost up to $420 million in scholarship funds in just three years, a total of 75,000 student scholarships. Kansans’ charitable contributions will now remain in-state, supporting local students. These funds will expand educational opportunities for K-12 students through scholarships for private school tuition, tutoring, homeschooling, special education services, books, supplies, and more.

Because scholarships will be funded by private donations, participation in the credit would not cost state governments a single penny. This is the first time the federal government has established a tax credit incentivizing K-12 scholarships and is a historic step toward school choice for every student in every state.

Kansas has more than a decade of experience operating a similar state level tax credit program—and has already certified a dozen SGOs—which makes opting in to the federal initiative a natural next step.

The 28 states that have already committed to participate are sending a clear signal to families, school leaders, and investors that a major expansion of education freedom policies are coming in 2027. Kansas lawmakers have passed a straightforward statutory modification that will have an enormous and lasting positive effect on Kansas students.