A new federal law gives donors a credit for gifts to scholarship-granting organizations, starting with contributions made on or after Jan 1, 2027. A donor could claim up to $1,700, after subtracting any state credit for the same gift, and the scholarships would go to students in households up to 300 percent of area median income.
A state has to opt in for its residents and organizations to take part. Governor Hobbs vetoed SB 1142, Arizona's opt-in bill, in April 2026, writing that signing before any federal regulatory guidance was released would be irresponsible; it was the third opt-in measure she vetoed. Her office describes her as waiting on federal rules rather than opposed to the idea.
In August 2026, U.S. Education Secretary Linda McMahon came to Mesa and urged the governor to opt in. Treasury guidance released since then says states must make an advance election by Jan 1, 2027 and submit a list of scholarship organizations by Feb 15, 2027 to take part for 2027.
As of today this credit is undecided for Arizona and is not something a Phoenix family can plan on. We will update this page if the state opts in. In the meantime, the state STO credits and the ESA are the tools that exist.
Combining it with other sources
This source works alongside a school's own discounts and payment plans. The one hard limit in Arizona is that a child cannot hold an ESA and an STO scholarship in the same school year, so each child goes down one path, and siblings may go down different ones. Our funding check lays out the choice for each child.