DeKalb County families could receive scholarships for tuition, tutoring and other education expenses through a new federal program scheduled to begin Jan. 1, 2027.

Georgia has opted into the Federal Scholarship Tax Credit program, which encourages private donations to nonprofit scholarship-granting organizations. Those organizations, known as SGOs, will award scholarships to eligible students.

Georgia was among 30 states that had elected to participate as of Sept. 14, according to the Internal Revenue Service.

The state’s participation does not guarantee a scholarship for every eligible child. Awards will depend on donations, participating organizations and their application processes.

How the donor credit works

The program was created by the federal law signed July 4, 2025, commonly called the One Big Beautiful Bill Act.

Under proposed Treasury and IRS regulations, individual taxpayers could claim an annual federal income tax credit of up to $1,700 for qualifying cash donations. Married couples filing jointly could claim a combined credit of up to $3,400.

The credit is nonrefundable, meaning it reduces federal income tax liability rather than automatically producing a payment to the donor.

Those limits apply to the donor’s tax credit, not the amount of a student’s scholarship. Donations would fund the awards, while the credit would reduce federal tax revenue.

A federal credit must also be reduced by any state tax credit received for the same contribution.

Who could receive a scholarship

The law defines an eligible student as someone eligible to enroll in a public elementary or secondary school whose household income is no greater than 300% of the applicable area median gross income, according to IRS guidance.

Scholarships can cover qualifying expenses such as private school tuition, tutoring, books, supplies, special-needs services, transportation, uniforms and certain technology costs.

Public school students may also benefit from scholarships for eligible supplemental services without changing schools.

Families should wait for participating organizations to publish application instructions and the applicable income requirements before assuming they qualify.

Georgia prepares to participate

Gov. Brian Kemp announced Georgia’s decision to join the program in January, saying it would complement the state’s existing scholarship tax credit efforts.

“All they had to do is sign an IRS form,” Kemp said, according to CBS Atlanta.

States must submit lists of eligible SGOs to the IRS. Qualifying organizations must meet federal requirements, including nonprofit status, spending at least 90% of their income on scholarships and serving at least 10 students who do not all attend the same school.

Organizations must verify student eligibility and cannot accept contributions earmarked for a particular student.

Oversight questions remain

Supporters describe the program as another way for families to access educational options.

Critics have raised concerns about accountability and whether donations will flow unevenly across communities. The Center for American Progress, a progressive policy organization, argues that the proposed rules provide insufficient protections for students and limit states’ ability to impose additional requirements on participating organizations.

Treasury and the IRS have issued proposed regulations alongside temporary rules governing preparations for the program. Families and prospective donors can follow the IRS program page for updates as implementation proceeds.