Frequently Asked Questions
What is this tax credit?
The federal government will provide a tax credit of up to $1,700 for donations to eligible 501(c)(3) Scholarship-granting Organizations (SGOs) beginning in 2027. Eligible organizations are listed by individual states to provide scholarships to students in their states. Students can only receive scholarships in states that choose to participate, but Americans from any state can donate to eligible organizations in any state and receive the tax credit.
What is a non-refundable tax credit?
A non-refundable tax credit reduces your tax liability by the amount of the credit, but not below zero (that is, it won't increase your refund). This is not a tax deduction, which reduces your overall income for tax purposes, but doesn't directly reduce your tax liability. Since this is a non-refundable tax credit, it's important that donors work to reduce the amount of tax withheld during the year, so that the tax credit can be used in full. For most working Americans, that only requires you to fill out a new W-4 form with your employer. The employer can then reduce how much they withhold from your paycheck (i.e. they can pay you more during the year, reserving less for the federal government), so long as you actually use the credit during the course of the year.
Is the St. Basil Scholarship Fund or the Basiliad Institute an eligible scholarship-granting organization?
Each state determines which organizations are listed once they have confirmed their eligibility under federal law. Thus far, no state has confirmed whether they will opt into the system. Once states confirm and lay out processes for eligibility, the St. Basil Scholarship Fund will work to become eligible.
The Basiliad Institute Inc. is founding the St. Basil Scholarship Fund as an independent non-profit to operate the scholarship funds. For now, it is only providing administrative support and initial funds to jumpstart the program. Eventually, the St. Basil Scholarship Fund will run the program in all states, or individual funds will be started in individual states if the law requires it, e.g. the St. Basil Scholarship Fund Oklahoma Inc., the St. Basil Scholarship Fund Pennsylvania Inc., etc.
How much can couples donate?
Anyone can donate as much as he wishes, with up to $1,700 per year per individual adult eligible for the tax credit. That means couples filing jointly can donate $3,400 per year.
Can I donate more than $1,700?
Donations beyond those eligible for tax credits are still eligible as tax deductible charitable donations to a 501(c)(3). For some individuals, taking the entire donation as a deduction instead of a tax credit could be more beneficial.