Idaho opens applications for nonprofits that want to give scholarships under the federal tax credit
The Idaho Department of Education posted an application for scholarship granting organizations, with assurances that cap administrative costs at 10 percent and require an annual independent audit. Idaho opted into the credit earlier this year; no deadline is given.
Boise. Nonprofits that want to give scholarships under the new federal tax credit for gifts to scholarship granting organizations can now apply to the Idaho Department of Education for approval, the department said on Oct. 12. Its online application asks for the organization's employer identification number, its 501(c)(3) determination letter or pending application, the Idaho schools or districts it works with, and how it will verify students' eligibility and family income. No deadline is given.
Idaho itself joined earlier. The state submitted documentation of its intention to take part on Jan. 20, and Gov. Brad Little issued Executive Order 2026-03 on Feb. 16, directing the department to carry out the credit. He signed House Bill 731, which opts the state in, on March 19, and the law took effect July 1. Idaho is on the Internal Revenue Service's list of participating states dated Sept. 14.
Starting Jan. 1, 2027, taxpayers may give up to $1,700, or $3,400 for married couples filing jointly, to an approved organization and claim a federal tax credit on their 2027 returns, the department says.
What an organization must agree to
An organization may qualify if it is recognized as a 501(c)(3) nonprofit, serves more than one school and at least 10 students, shows the administrative and financial capacity to run the program, and is approved by the department, which says federal guidance may add requirements.
Applicants sign assurances that they will run criminal background checks on all employees and board members, hire an independent certified public accountant for an annual audit and give a copy to the department and to any member of the public who asks. They may spend no more than 10 percent of contributions on administrative costs and must pay out all income earned on contributions as scholarships. Donors may designate a participating school but not a specific student, and each receipt must show the donor's unique identity number. The department may audit an organization and may suspend or end its approval for intentional or substantial failure to comply.
When families can apply
Scholarships may pay for tutoring, special education costs not covered by a student's Individualized Education Program, learning materials, transportation, extended-day programs, and computers and internet access. The department's release says private school students may also use them for tuition or fees.
The release says families can now apply, but the department's page listed no approved organization on Oct. 13; the department said it would publish that list and guidance for families in the coming weeks. Debbie Critchfield, the superintendent of public instruction, told KMVT that spring 2027 may be the earliest students can apply, depending on when organizations receive money, and that home school students are not currently eligible.
About this story
501c3.help wrote this story from the sources listed with it, not from material an organization sent. Our editors approved it on Oct. 13, 2026. Stories in The Nonprofit Herald are free, and nothing is asked in return. Editorial rules.
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