Treasury and the IRS have issued guidance allowing states, including the District of Columbia, to participate in a new nonrefundable tax credit for individuals contributing to scholarships for elementary and secondary school students from low and middle-income families.

The maximum credit is limited to $1,700 per taxpayer. To qualify, Scholarship Granting Organizations must be listed on a State list of covered states that elected to participate in the credit for calendar year 2027.

To make this Advance Election, States must submit Form 15714, Advance Election to Participate Under Section 25F, for 2027 beginning Jan. 1, 2026.

For more information, see this news release.