Big News: Federal School Choice is Here—And It Impacts Alabama
Thanks to the passage of the One Big Beautiful Bill, a landmark provision called the Educational Choice for Children Act (ECCA) is now law. This is the first federal school choice program of its kind, and it opens new doors for both families and donors, including right here in Alabama.
For Parents: Expanded Educational Opportunity Starts in 2027
Beginning
January 1, 2027, families in Alabama will be eligible to apply for
federally funded scholarships to help cover the cost of:
- Private or faith-based school tuition
- Tutoring and curriculum
- Testing fees and homeschool materials
- Online learning and more
Who qualifies?
Families earning up to 300% of the median income in their area, which includes the vast majority of households in Alabama.
How does it work?
The scholarships are made possible through private donations to SGOs, just like Alabama's AAA Tax Credit Scholarship, which then award funds to eligible students. These scholarships offer parents the freedom to choose the learning environment that best fits their child’s needs—regardless of ZIP code or income level.
For Donors: A New Way to Make a Federal Impact
The ECCA introduces a federal tax credit of up to $1,700 per year per taxpayer for donations made to approved SGOs. Unlike a deduction, this is a dollar-for-dollar credit—a powerful new incentive to support educational access for underserved students.
Key details:
- Individuals can receive a 100% federal income-tax credit—up to $1,700 per year—for donations to qualifying SGOs. The law allows unlimited annual cap, making the benefit permanent.
- This federal credit can complement state-level tax credits, like Alabama’s existing programs.
For donors, it’s a way to make your giving go further, expanding access to quality education while receiving meaningful tax relief.
What’s Next in Alabama?
This program is federally authorized, but each state must have qualified SGOs to process donations and award scholarships. Over the coming months, we’ll be working to ensure Alabama is ready for full participation by 2027.
The U.S. Department of Treasury will develop the rules and regulations for the federal scholarship program. We’ll keep you informed on how to apply for scholarships or make qualifying donations.
A Transformative Moment for Educational Freedom
Whether you’re a parent exploring school options or a donor looking to make a high-impact gift, the ECCA is a game-changer. It’s about equity, access, and empowering families—and it’s built on the support of those who believe every child deserves the chance to thrive.
