Sources checked October 19, 2026. Editorial policy review is pending. The October proposed regulations are not final; reliance for 2027 contributions requires following them in full and consistently. T.D. 10057 has a December 1, 2026 effective date and September 1, 2026 applicability provisions. Check current IRS guidance before acting.
Key takeaways
- July 4, 2025: §25F enacted as part of the One Big Beautiful Bill Act.
- Late 2025: the IRS asks for public comment (Notice 2025-70) and releases the advance-election procedure (Rev. Proc. 2026-6, Form 15714).
- 2026 so far: states file advance elections (30 in the July 27 report, describing a roster current as of July 24), Treasury previews the rules June 9 to 10, and the proposed and temporary regulations are released on October 1, 2026.
- Coming up: comments due December 1, public hearing December 15, state advance elections due January 1, 2027, state SGO lists due February 15, 2027.
- January 1, 2027: the credit goes live; donations from this date forward count.
- 2028: donor acknowledgments by January 31, SGO reports to the IRS by February 28, and donors claim the first §25F credits on their 2027 returns.
Each date below is marked done or upcoming as of October 19, 2026. Dates set by Treasury’s temporary regulations are binding (those rules take effect 60 days after publication and apply from September 1, 2026); dates that come only from the proposed regulations are labeled proposed, because final rules could change them.
2025, enactment and first guidance
July 4, 2025 (done). The Education Freedom Tax Credit was created as Section 70411 of the One Big Beautiful Bill Act (Public Law 119-21), which added IRC §25F (the donor credit) and IRC §139K (the income exclusion for scholarship recipients).
November 25, 2025 (done). The IRS issued Notice 2025-70, requesting public comment ahead of proposed regulations on state certification, SGO requirements, donor substantiation, and income verification. The comment period closed December 26, 2025, and Treasury says the October 2026 rules are informed by those comments.
December 12, 2025 (done). Treasury and the IRS released Revenue Procedure 2026-6 and Form 15714, establishing the advance-election process that lets states commit to participating in 2027.
2026, elections, lists, and rulemaking
January 1, 2026 (done). The window opened for states to file the advance election (Form 15714) declaring their intent to be a covered State for 2027. Read the state election steps and deadlines in this guide.
June 8, 2026 (done). The IRS announced (IR-2026-76) that 27 states had completed the formal advance election. That was the official roster, distinct from the larger count of states that had opted in by legislation or announcement but not yet filed. See the source reporting of the official list.
June 9 and 10, 2026 (done). Treasury previewed the §25F proposed regulations in remarks on June 9, published June 10. It said it expected to issue them no later than the end of September 2026, with states, SGOs, and taxpayers able to rely on them for tax year 2027. The preview covered the 90% segregated-account safe harbor, the multistate SGO path, income verification, audits, and a unique-donor-number reporting system. The rules as released differ from it in several places; compare the published October proposal with the June preview when assessing those changes.
July 27, 2026 (done). The July 27 source report described the IRS roster reaching 30 states, current as of July 24, after Kentucky’s filing. For the first time the official count matched the source map. See the source reporting of the 30-state roster. Treasury’s October rules also count 30 states as of August 2026.
September 1, 2026 (done). The applicability date written into the temporary regulations: by their terms they apply on or after this date, so the IRS has procedural rules in place while it builds the systems. They were not published until October.
October 1, 2026 (done). Treasury and the IRS released the proposed regulations (REG-117199-25) with companion temporary regulations (T.D. 10057), filed for public inspection on October 1 and published in the Federal Register on October 2, along with a press release and fact sheet. Our coverage of the release walks through what they say.
December 1, 2026 (upcoming). Comments on the proposed regulations are due (60 days after publication), at regulations.gov under REG-117199-25. Requests to speak at the hearing, with an outline of topics, are due the same day. The temporary regulations also take effect that day, 60 days after publication. See how to comment or testify.
December 10, 2026 (upcoming). Requests to attend the public hearing are due by 5 p.m. Eastern.
December 15, 2026 (upcoming). Public hearing on the proposed regulations, 10 a.m. Eastern, at the IRS building in Washington, with a telephone option. If no outlines of testimony arrive by December 1, the hearing is canceled.
Through December 31, 2026 (upcoming). States that have not filed decide whether to submit an advance election and prepare the SGO list they will submit to the IRS. That list must include every organization located in the state that asks to be listed and meets the federal requirements. SGOs register in the IRS SGO portal once it opens, which the temporary regulations ask them to do “as soon as possible and preferably before” they appear on a state list. A new organization that wants to be on a 2027 list while its 501(c)(3) application is pending needs an exemption effective by January 1, 2027, so it should be formed by then. Track where each state stands on the IRS state-participation roster.
2027, the credit goes live
January 1, 2027 (upcoming). §25F takes effect. Under §70411(c), the credit applies to taxable years ending after December 31, 2026, so cash contributions made on or after January 1, 2027 to a qualifying SGO in a covered State can generate the federal credit. Scholarship amounts received by families are excluded from income under §139K. The same day is the deadline for a state’s 2027 advance election on Form 15714 under the temporary regulations; a state that misses it cannot join for 2027 just by sending a list.
February 15, 2027 (upcoming). Deadline for each electing state to submit its 2027 SGO list, which perfects its advance election. If the list is late, “no organization in that State would qualify as an SGO for the calendar year.” States may add or replace organizations on the list until this deadline; later state-list additions generally wait for 2028 unless IRS guidance provides otherwise. This federal deadline is distinct from state application deadlines. An organization already included as pending on a timely state list can be added to the IRS public list after recognition effective by January 1 and disclosure consent; that is not a late addition to the state list. The IRS publishes the SGOs on state lists that authorize disclosure, organized by state, on its IRS SGO list, which donors may rely on when they give.
Throughout 2027. Donors anywhere in the country can give to an SGO in any covered State; the donor’s home state does not matter. Scholarships follow the student’s residence: a student can get a scholarship from an SGO listed by the state where the student lives, including for a school in another state. Under the proposed regulations, each spouse in a married couple can claim up to $1,700 for their own designated gift, so a joint return can carry up to $3,400. Gifts must be designated as §25F contributions when made, and must be made by December 31, 2027 to count for the 2027 tax year.
January 2 to September 30, 2027 (upcoming). The advance-election window for 2028. A state that participated in 2027 can instead elect for 2028 by submitting its list between October 1, 2027 and January 1, 2028; a state electing for the first time after 2027 follows procedures the IRS has said it will set in future guidance.
2028, the first filing season
January 1, 2028 (upcoming). Deadline for states’ 2028 SGO lists, which runs to 11:59 p.m. that day.
January 31, 2028 (upcoming). SGOs send each donor a written acknowledgment for 2027 with the SGO’s EIN, the donor’s designated total, and the donor’s unique donor number (required under the temporary regulations, effective December 1, 2026). Donors never give the SGO a Social Security number.
February 28, 2028 (upcoming). SGOs report each donor number’s name, address, and 2027 total to the IRS through the IRS SGO portal (required under the temporary regulations, effective December 1, 2026).
2028 filing season (upcoming). Donors claim their 2027 §25F credits when they file their 2027 federal returns. The credit is nonrefundable and capped at $1,700 per taxpayer; unused amounts carry forward up to five years. The proposed regulations name the claim form, Form 8525, Federal Scholarship Tax Credit, on which the donor lists each SGO’s donor number; the IRS has not released the form yet. See the federal tax credit explained for worked donor examples.
During 2028 (upcoming, proposed). For a calendar-year SGO operating in 2027, the first annual reporting and audit cycle follows in 2028. Under the proposal, SGOs required to file an annual information return under §6033(a) attach the prescribed certification and information form. Organizations not required to file that return submit the form separately by the 15th day of the fifth month after the reporting period. Each listing state receives a copy. Every SGO undergoes an annual financial and programmatic audit. Above $500,000 in total annual receipts, an external independent professional or accredited body must conduct it; at or below that threshold, an independent committee unrelated to management may do so and must sign its report under penalties of perjury.
December 31, 2028 (upcoming, proposed). A calendar-year SGO must have spent at least 90% of its 2027 income on scholarships. Under the proposed regulations each year’s income must be spent by the end of the following taxable year, so an SGO’s first year is not tested until the end of its second. See 90% spending requirements in the proposed regulations.
Then: an annual cycle
After the first year, the program settles into a yearly rhythm set by the temporary regulations: states file advance elections between January 2 and September 30, submit SGO lists between October 1 and January 1, SGOs raise and award funds through the year, send donor acknowledgments by January 31 and IRS reports by February 28, and donors claim credits on the following spring’s returns. Under the proposed rules, each year’s SGO income must be spent by the end of the next year, and every SGO files an annual certification and gets an annual audit.
Each election covers one calendar year, and a completed election cannot be revoked. A state that sits out one year can join a later one, and a participating state can decline to elect for the next year. The political and operational calendar repeats annually.
October 1, 2029 (upcoming). The temporary regulations expire. Treasury has not announced when it will issue final regulations.
Running an SGO into the 2027 launch? a scholarship-management process handles donor collection, §25F receipts, family applications, income verification, awards, and disbursement, built around this timeline.
Frequently asked questions
When does the Education Freedom Tax Credit start?
January 1, 2027. Under §70411(c) of the One Big Beautiful Bill Act, §25F applies to taxable years ending after December 31, 2026, so cash contributions made on or after January 1, 2027 can generate the credit. Gifts made in 2026 do not count.
When can a donor first claim the credit?
On the federal return for the 2027 tax year, filed in 2028. The credit is nonrefundable and capped at $1,700 per taxpayer; under Treasury's proposed regulations, which taxpayers may rely on for 2027 contributions, a married couple filing jointly can claim up to $3,400 when each spouse makes and designates a gift. Unused credit carries forward up to five years. The SGO's written acknowledgment, with the donor's unique donor number, is due by January 31, 2028. The proposed rules name the claim form, Form 8525, which the IRS has not released yet.
When do states have to decide?
Under the temporary regulations Treasury issued on October 1, 2026, which apply from September 1, 2026, a state that wants to participate in 2027 must submit an advance election on Form 15714 by January 1, 2027 (the form could be filed starting January 1, 2026) and perfect it by submitting its SGO list to the IRS by February 15, 2027. If the list does not arrive in time, no organization in that state qualifies for 2027. Elections cover one calendar year at a time. For later years, advance elections run January 2 through September 30 of the preceding year, and SGO lists are submitted between October 1 and January 1.
What are the key dates for the §25F regulations?
Treasury and the IRS released proposed and temporary regulations on October 1, 2026, for publication in the Federal Register on October 2. Comments on the proposed rules are due December 1, 2026; requests to attend the public hearing are due by 5 p.m. Eastern on December 10; the hearing is December 15, 2026 at 10 a.m. Eastern (canceled if no outlines of testimony arrive). The temporary regulations take effect 60 days after publication, apply on or after September 1, 2026, and expire October 1, 2029. Treasury has not announced a date for final regulations.
When does an SGO have to spend its first donations?
Under Treasury's proposed regulations, an SGO must spend at least 90% of each year's income on scholarships by the last day of the following taxable year. For a calendar-year SGO, 90% of its 2027 income must be spent by December 31, 2028. Amounts count as spent when paid.
Is the program permanent?
§25F has no scheduled end date in the statute, but each state decides whether to participate one calendar year at a time, and Congress could change or repeal the credit. As of October 2026, it remains the law, Treasury counted 30 participating states as of August 2026, and the credit begins January 1, 2027.
Sources and guidance
Sources checked October 19, 2026. Proposed rules and projections are identified in the article. Consult the latest official guidance before acting.
- Temporary regulations
- Proposed regulations
- IRC §25F
- IRC §139K
- Notice 2025-70
- Revenue Procedure 2026-6
- Form 15714
- Our coverage of the official list
- Previewed the §25F proposed regulations
- Our coverage of the 30-state roster
- Press release
- Fact sheet
- Coverage of the release
- How to comment or testify
- Our story on the 2027 calendar
- §70411(c)
- Supporting source
