What is a Scholarship-granting organization?
A scholarship-granting organization is a 501(c)(3) nonprofit entity that distributes at least 90% of donations as educational scholarships to eligible K-12 students from moderate-income families under the One Big Beautiful Bill Act. These organizations must maintain administrative costs below 10%, undergo annual independent financial audits, and serve at least 10 students across multiple schools. Donors receive federal tax credits of up to $1,700 annually for contributions. In contrast, recipients receive tax-free scholarship support for private school tuition, tutoring, and educational services, in coordination with Child & dependent tax credits for comprehensive family tax benefits.
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