What you should know about the Educational Choice for Children Act (ECCA)

Since 2012, the Aim Higher Foundation has focused on one goal: expand access to the life-changing benefits of a values-based education by providing scholarships to K-8 students from families with demonstrated financial need. In Minnesota, we are a one-of-a-kind scholarship granting organization. With the recent passing of a new federal scholarship tax credit bill, we have an opportunity to reach even more students!

What is the Educational Choice for Children Act (ECCA)?

The ECCA was included as part of the federal reconciliation bill signed into law on July 4, 2025. The ECCA established a tax credit program for individuals who donate to state-approved scholarship-granting organizations (SGOs).

 

Tax Credit & Eligibility

  • Every American can contribute up to $1,700 to a scholarship organization — a 501(c)(3) nonprofit — and receive a dollar-for-dollar federal income tax credit.
  • A tax credit is a direct reduction of the amount of tax a person owes, as opposed to a tax deduction, which reduces taxable income.
  • There is no annual cap on the total amount of tax credits available nationwide.
  • This law is permanent and does not have a sunset clause.

 

Scholarship Recipient Eligibility

  • Scholarship recipients must come from households earning less than 300% of their area’s median income (based on HUD guidelines, this includes approximately 85–90% of households).
  • Additional criteria for recipient eligibility is individually set by each SGO.

 

Scholarship-Granting Organization (SGO) Eligibility

  • Governors in each state will determine which SGOs are eligible to receive donations.
  • These scholarship groups can fund a wide range of educational expenses.

 

It’s unclear whether or not Minnesota will participate in this program. We are confident in our reputation as a trusted and credible scholarship-granting organization and are actively exploring all options to ensure that you can leverage this opportunity to change a life.

Helping More Parents Choose

How it Works

For Donors

Individual donors (not corporations) receive a 100% nonrefundable federal tax credit for contributions up to $17000 per individual per year.

For Families

Scholarships become available up to students (enrolled or eligible to enroll in a K-12 public school) from households earning up to 300% of the area median income.

For Schools

Schools (and other fee-based educational services) will receive funding from qualified scholarship granting organizations for eligible students who received scholarships.


FREQUENTLY ASKED QUESTIONS

When will this program go into effect?

The scholarship tax credit will begin on January 1, 2027. Donations can be made starting on that date. Scholarships would be available for the school year beginning later in the fall of 2027.

Is Minnesota participating in this program?

Under the new provision, each state must voluntarily choose to participate in the program. There has been no decision yet on whether or not Minnesota will opt in. The Aim Higher Foundation is exploring all options to leverage this opportunity for our students, families, and donors.

How is ECCA different from traditional school vouchers?

The ECCA uses federal tax credits to encourage private donations for K–12 student scholarships, empowering families to choose the education that best meets their needs—without reducing funding for public schools. Unlike traditional voucher programs that rely on state-appropriated public funds, the ECCA takes a different approach by incentivizing private investment in local communities across America.

What is the maximum I can donate to the Aim Higher Foundation to receive the full tax credit amount?

The ECCA allows individuals to donate $1,700 per year to receive a full 100% tax credit. However, there are many options to support the Aim Higher Foundation beyond this tax credit including legacy giving, donor advised funds, stocks and securities, and more!

Can unused credits be carried over?

Yes. Tax credits that are not used in the current year may be applied to future tax years for up to five years.

Can corporations and businesses receive this tax credit?

The ECCA only allows individual taxpayers who make qualifying donations to receive the tax credit. However, business leaders can play an important role by educating people about the tax credit and encouraging them to give. Corporations and businesses interested in supporting the Aim Higher Foundation are encouraged to contact us directly and exploring our Ways to Give page.

Want to learn more?

As more information becomes available before the bill goes into effect in 2027, we will share it on this page. In the meantime, please feel free to reach out to our team who will be happy to discuss the federal scholarship tax credit with you. Contact us at [email protected] or at 612-819-6711.