The proposed rules for the Federal Scholarship Tax Credit were released on October 1, 2026, and the program opens January 1, 2027.1 That gives homeschool families roughly three months to get organized. You do not need to understand every line of the 50-plus-page Federal Register notice to be ready.3 You need to know your state’s status, how your state defines your homeschool, and how to document what you already do. Here are six concrete steps.
New to the program? Start with our plain-language explainer.
Step 1: Confirm whether your state is in
Scholarships only reach students in states that opt in.8 As of the most recent Treasury list reported by the Associated Press, 30 states were participating for 2027: Alabama, Alaska, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia and Wyoming.4 Education Week’s tracker counted 31 states opted in or on track as of October 1, with 19 states still out.6 Because governors can decide before the start of each year, this list can change; check your governor’s office and your state education agency before you plan around it.6
If your state is not participating, you are not shut out of donating. An eligible donor may claim a nonrefundable credit of up to $1,700, and qualifying spouses filing jointly may potentially claim up to $3,400 combined, for a gift to an SGO in a participating state, even though the scholarships will go to children elsewhere. Tax liability and state-credit coordination can limit current-year use; unused credit may carry forward for up to five years.1,3,5 Some families will see that as a way to support the homeschool community while their own state catches up.
Step 2: Learn how your state legally classifies your homeschool
This is the step most families skip, and it may turn out to be the most important. The proposed rule defines qualified expenses by cross-reference to the Coverdell list in section 530(b)(3)(A) of the tax code, and defines “school” as “any school that provides elementary education or secondary education (kindergarten through grade 12), as determined under State law.”3 Treasury officials have told the press that homeschooling costs are a permitted use, but the detailed expense guidance has not been issued yet; Treasury says it intends to publish it “as soon as possible.”3,4
Because the definition leans on state law, whether your homeschool is treated as a private school, a home instruction program, or something else in your state’s statutes could affect how an SGO handles your application. Look up your state’s homeschool statute or regulations, note the exact legal term your state uses, and keep a copy of any notice, affidavit or declaration you file. If your state offers a choice of routes (for example, operating as a private school versus filing under a home instruction option), understand which one you are on. Our homeschool laws by state page is a starting point, but confirm the current rules with your state education agency, because requirements change.
Step 3: Start keeping receipts and instructional records now
SGOs will be handling other people’s charitable dollars under federal rules. The proposed regulations require that tuition and similar charges be paid directly to a school, and allow other vendors to be paid directly only if they are verified as appropriate providers, are unrelated to the student, and agree to reimburse the SGO for any overpayments or errors.3 Expect documentation requests.
Even before the expense guidance arrives, you can build the habit: keep receipts for curriculum, books, supplies, computers, tutoring, co-op fees, online classes and special-needs services, all of which appear on the lists officials have described.2,4 Keep an attendance or instructional-time log and a simple record of subjects covered. Many states already ask homeschool families to keep records like these, and they make a transcript easier to assemble later.
You are probably already doing more of this than you think. The Johns Hopkins Homeschool Research Lab, in a nationally representative survey of more than 2,400 parents run with RAND’s American Life Panel, found that 88 percent of homeschooling parents use supplemental educational supports (online resources, co-ops, online classes, online schools or tutors), compared with 44 percent of parents overall.12 Each of those supports leaves a paper trail worth saving.
Step 4: Check your household income against the local threshold
Eligibility requires household income no greater than 300 percent of your area’s median gross income.8 That figure is local, not national; Education Week cites an EdChoice analysis showing it ranges from $616,500 in Santa Clara County, California, down to $107,100 in Oglala Lakota County, South Dakota.5 Treasury expects roughly 96 percent of children in participating states to qualify.1 Certain families already in needs-based assistance programs, and foster children, get a streamlined verification path, and the proposed rules generally disregard non-cash items such as imputed return on home equity when applying the income test.1
Step 5: Decide, as a family, whether you want to participate
Not every homeschooling family will want outside funding, and that choice deserves respect. The Home School Legal Defense Association has long opposed education savings accounts for homeschoolers because government funds can bring government rules.9 It views this program differently: families apply to a private charity rather than a government agency, donors cannot direct money to a specific child, and the program “does not impose new federal regulations” on how a family privately educates, which is why HSLDA says it supports the credit “for now” while watching implementation.9 Federal law also prevents participating states from narrowing the types of schools or expenses allowed.3
Read the rules, talk it through, and decide with clear eyes. Written comments are due December 1, 2026, and a public hearing is scheduled for December 15, 2026, so families who have concerns or suggestions can be heard.3
Step 6: Watch for your state’s SGO list in early 2027
Participating states must provide their SGO lists by January 1 each year, and a Treasury official told Education Week that states must finalize their rosters by February 15, 2027.5,8 SGOs, not the government, decide award amounts, and awards are not capped the way the donor credit is.8 When your state’s list appears, read each organization’s mission and application process; some SGOs may focus on private-school tuition while others may be built around homeschool and hybrid families.
Why it is worth the effort
Homeschooling is on solid ground. The Johns Hopkins lab reported that homeschooling grew an average of 4.9 percent in 2024–25, more than double the pre-pandemic pace, with 36 percent of reporting states at all-time highs.12 A 2024 Journal of School Choice study by Angela R. Watson found that three years after the pandemic peak, most states with data were still reporting increased participation.16 And a 2026 systematic review in the Peabody Journal of Education found that 15 of 24 achievement studies and 16 of 25 social-emotional studies since 2017 favored homeschooled students, with the authors noting these are associations rather than proven cause and effect.14 Research using the 2019 National Household Education Survey also found homeschooling families averaged more home-based educational activities per week (4.7 versus 3.5 to 3.7) and were far more likely to have visited a library in the past month (60 percent versus 32 percent of public-school families).15
A funding stream that respects that independence is worth preparing for. Three months is plenty of time if you start this week.
Your checklist
- Confirm your state’s participation status with your governor’s office or education agency.4,6
- Identify the exact legal classification of your homeschool under state law and keep copies of filings.3
- Start a receipts folder and an instructional log today.2,3,4
- Compare household income with 300 percent of your area median.5,8
- Decide as a family whether participation fits your convictions; submit comments by December 1, 2026, if you have input.3,9
- Watch for your state’s SGO list by January 1 and the final roster by February 15, 2027.5,8
This post is educational, not legal or tax advice. Program details are still being finalized and homeschool requirements vary by state; confirm current rules with your state education agency and talk with a qualified tax professional before making decisions.