by Colleen Enos, CHEC Director of Government Relations
By now, everyone has heard about the passage of HR1, the One Big Beautiful Bill Act, by our Federal Congress. President Trump signed the bill into law on the 4th of July, before the fireworks began exploding in Washington, D.C., to celebrate America’s 249th birthday. The Educational Choice for Children Act (ECCA) was included in the legislation. Passing the bill was a monumental event, with the Trump Administration touting it as its signature achievement.
It is important to note that the Education Scholarship donations provided for in the bill are made by individuals and are, therefore, private monies. They are not tax dollars. Delmarva claims that “this structure is intended to address concerns, particularly from homeschooling communities, about potential government ‘strings’ or mandates attached to funding.” The tax credit is an incentive to encourage individuals to donate to Scholarship Granting Organizations. Whether or not this structure protects against government regulations for homeschoolers remains to be seen.
While we wait for the details of how this legislation will be specifically implemented throughout our states with regulations and guidance, two sections of the bill stand out for homeschoolers. In Title VII, Subchapter B, Section 70411, the tax credit guidelines for education scholarships are explained. Here are some of the notable specifics:
- Individuals can receive up to a $1,700 nonrefundable tax credit when they donate to a nonprofit 501(c)(3) Scholarship Granting Organization (SGO).
- States (like Colorado) must opt in to the program and identify the state list of SGOs that meet the requirements.
- SGOs must be included on the state list and agree to be bound by the listed requirements.
- SGOs apply eligibility guidelines and determine award amounts.
- Eligible students must come from households with no more than 300% of the area median gross income.
- Eligible expenses listed in the ECCA are tuition, curriculum, books, tutoring, test fees, and therapy. Private, religious, and home schools operating under the state law are included.
The program is not automatic for every state; individual states must voluntarily opt in to the program. Governor Polis and his advisors may or may not choose to participate. If our state does not opt in, no Colorado students are eligible. However, if he does opt in to the program, homeschools may be affected. This section of the One Big Beautiful Bill does not take effect until the tax year 2027.
The second section of interest to homeschoolers is the expansion of 529 investment savings accounts. Investopedia says that “Section 529 plans are tax-advantaged accounts that can be used to pay educational expenses, including K-12 education, apprenticeship programs, and student loan repayment.” A 529 investment account is usually established by a parent or grandparent for the benefit of a child or grandchild’s education expenses. The One Big Beautiful Bill has expanded the definition of qualified education expenses that 529 investment accounts can be used for to include elementary and secondary K-12 costs, while also doubling the limit on withdrawals each year.
All in all, there are some things to watch as the details are fleshed out in the One Big Beautiful Bill. CHEC believes that home education should be Christ centered, parent directed, and free from government control. We want to make sure that parents are controlling their children’s education, and not the government.
In Him,
Colleen Enos
CHEC Director of Government Relations
colleen@chec.org
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