Pennsylvania kids will lose scholarships if Gov. Shapiro fails to opt in to the federal scholarship tax credit.

What is the FSTC?

The new Federal Scholarship Tax Credit (FSTC) program will provide K12 scholarships for most of Pennsylvania’s public and private school students, but only if Governor Shapiro opts-in by January 1, 2027.

How does it work?
  • Individuals donate up to $1,700 annually to Scholarship Granting Organizations (SGOs) and receive a dollar-for-dollar non-refundable IRS federal tax credit.
  • SGOs accept donations and award scholarships to eligible students residing in families earning less than $368,100 annually.
  • Parents apply to SGOs for scholarships to cover tutoring, extended day programming, tuition, fees, books, school supplies, and special education expenses for K12 students attending public, private, charter, cyber charter, career technical, and other schools.
Why does it matter?

About 93% of Pennsylvania’s K12 students are eligible to receive millions of
scholarship awards in 2027, but only if Governor Shapiro opts-in.

Community Impact

Sources & Methodologies

Estimates of potential donations available for students and student eligibility comes from the PA Department of Revenue personal income tax statistics (table 4), the PA Department of Education’s personal income by school district weighted by each school district’s share of the county’s actual tax bracket counts, and the U.S. Census Bureau’s American Community Survey (ACS) 2019–2023, 5-Year Estimates, Table B19013, median household income by school district and county.

The distribution by school district, county and legislative districts utilizes the U.S. Census Bureau, 2020 Census P.L. 94-171 for block-level population weighted for legislative districts by actual population instead of land area. In addition, 2022 Census Block Assignment Files are matched against population data to compute each legislative district’s real population share of each overlapping county and population share of each overlapping school district within a given county.

Methodology – Scholarship Estimates

County and statewide figures use the Pennsylvania Department of Revenue’s 2023 counts of tax filers by income bracket. School district and legislative district figures are estimates based on county numbers. Estimates assume a participation rate of 10% with each participant taking the maximum credit.

Scholarship Estimates = (# of filers in a county/district) x (participation rate) x $1,700

Methodology – Student Eligibility Estimates

Using 2025-26 Pennsylvania Department of Education K12 public school enrollment data, coupled with 2023 Pennsylvania tax data for families earning less than 300% of their county’s median income, approximately 1.38 million students, or 93% of K12 students in Pennsylvania are eligible. (Students attending charter, cyber charter, private, home school, and microschool students have been excluded from the dataset.)