Treasury Releases Final Rules: Next Steps for Catholic Schools
The U.S. Department of the Treasury released the final rules for the first year of the Federal Scholarship Tax Credit (FSTC). The program launches on January 1, 2027, less than three months from now. According to the AFC, if just 5% of eligible taxpayers nationwide participate, the FSTC is estimated to generate $9.4 billion a year for K–12 scholarships. Catholic schools that prepare now will be ready to engage donors from day one and bring scholarships to the families who need them most.
What the rules confirm:
Donors can claim a dollar-for-dollar federal tax credit of up to $1,700 per individual, or $3,400 per married couple filing jointly, for contributions to SGOs.
Scholarships can cover tuition and other eligible K–12 expenses.
Donors can give across state lines, opening the door to alumni and supporters nationwide.
Gifts must be made between January 1 and December 31, 2027 to count toward 2027 taxes.
Families can receive scholarships only if their governor opts in by January 1, 2027. States must submit their approved SGO lists by February 15, 2027.
Next steps for Catholic school leaders:
1. Meet with CEOF this fall. Our team will walk your leadership and advancement team through how the FSTC works and what it means for your school, your donors, and your families.
2. Sign your commitment agreement. Partner schools complete a commitment agreement to begin onboarding and ensure your school is ready before launch.
3. Prepare your donors. Using CEOF’s FSTC marketing toolkit, start conversations now with alumni, donors, and parents so they’re ready to give in January.
4. Prepare your families. Let current and prospective families know scholarships may be available for the 2027–28 school year.
5. Advocate for opt-in. If your governor has not committed to participating, encourage your school community to speak up. Without opt-in, families in your state cannot receive these scholarships.
Why partner with CEOF:
Catholic Education Opportunity Fund is ready to help your school prepare. Our technology infrastructure is in place to manage donor contributions, verify scholarship eligibility, ensure regulatory compliance, and award scholarships to families at participating Catholic schools. Our FSTC marketing toolkit will give schools the materials they need to bring awareness to the program and educate donors, families, and faculty about this transformative opportunity for Catholic education.
To schedule a meeting and begin your partnership, contact Joseph Esser at jesser@catholicopportunity.org.