A federal school-choice provision has officially become law under President Trump, marking a watershed moment for conservative education reform. The Educational Choice for Children Act, part of a massive tax-and-spending measure, establishes the first-ever nationwide tax-credit scholarship program but allows Democratic-led states to opt out.
The legislation creates a permanent setup enabling individuals and businesses to receive 100% federal tax credits (up to $1,700) for donations to scholarship‑granting nonprofits covering costs for private or religious schools, textbooks, and tutoring. Though the House version capped spending at $5 billion, that limit was removed in the Senate’s final version, making the program open‑ended with the total revenue impact potentially exceeding $100 billion annually.
However, the law grants governors the authority to decline participation. This “opt‑out” clause means blue states with Democratic leadership could shield themselves from the program, limiting access to school choice in many urban and union-stronghold areas. Advocates like EdChoice’s Robert Enlow celebrate the move as revolutionary, but remain wary of uneven state-level uptake.
A major conservative milestone, this law embeds school-choice incentives directly into the federal tax code, crafting a powerful, long-term tool against failing public schools. Republican senators such as Bill Cassidy hailed it as a “major win” for parent empowerment. But critics warn it shifts attention and funding away from traditional public education.
Key Takeaways from the ‘Educational Choice for Children Act‘:
- 100% federal tax credits (up to $1,700) incentivize donations to scholarship nonprofits.
- No federal spending cap now— sharply expanding the program’s potential.
- Governors can opt out, potentially shielding blue states from participation.
- Launch date is January 2027, with eligibility for families earning up to 300% of area median income.
This law advances a central conservative priority by enabling federal support for private and religious education. It reduces the federal role in public school funding and shifts decision-making power to families. States with Democratic leadership may reject participation, limiting the law’s reach and deepening the divide between red and blue state education policies.
