Redirect Your Federal Taxes to Student Scholarships
AT NO COST TO YOU
3 Easy Steps
IT TAKES LESS THAN 5 MINUTES
What to Know About the Tax Credit
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The Educational Freedom Tax Credit is a federally authorized program that the state of Colorado has opted into. Essentially your Federal Taxes are funneled to a Scholarship Granting Organization (SGO) and written off for a tax credit while you are filing your 2028 taxes. It isn’t a loophole, rather, it is intended to expand education access for families who otherwise couldn’t afford it.
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A regular charitable donation gives yoou a deduction, meaning it reduces your taxable income, resulting in saving a fraction of what you gave. A tax credit reduces your actual tax bill dollar-for-dollar. So, if you owe $1,700 in Federal taxes and donated $1,700 to a SGO, your tax bill drops to $0. A tax credit allows you to redirect your money from going to the government to a school you actually believe in.
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Yes, there are limits based upon household income. You have make less than 300% than the median household income in the area you live. Additionally, the cap you can donate to any Scholarship Granting Organization per year to receive a tax credit is $1,700.
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Your should be donating directly to a Scholarship Granting Organization licensed by the state who are required to distribute 90% of the donation to a student at the school you designated.
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When students are awarded scholarships they can use them to cover tuition, uniforms, school materials, transportation fees. The money does not go to administration overhead, operating costs, or programs, it goes directly to the student.
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Yes, if you are supporting several schools you can support both. Your allotted amount is still $1,700 so you can donate $850 to school one and $850 to school two. You cannot allot more than $1,700 to any SGO per year.