TL;DR: On January 1, 2027, the federal scholarship tax credit begins, and North Carolina is in. Raleigh taxpayers will be able to give up to $1,700 to an approved scholarship granting organization and take a dollar-for-dollar federal credit, but as of late October 2026 NCSEAA had not yet published which organizations qualify.
How does the federal scholarship tax credit work for Raleigh taxpayers?
A person who gives to an approved scholarship granting organization (SGO) can take a nonrefundable federal tax credit for the gift, dollar for dollar, up to $1,700. The credit applies to tax years that begin after December 31, 2026, so gifts made from January 1, 2027 are the first that count. The SGO then gives scholarships to K-12 students in households at or below 300% of area median income.
This is a federal program that states had to choose to join. Under the state law that opted North Carolina in, an SGO may also fund home-school expenses to the extent federal law allows.
How did North Carolina opt in?
Through HB 87, the Educational Choice for Children Act. Gov. Josh Stein vetoed it on August 6, 2025. The House overrode the veto 73-46 on May 20, 2026, and the Senate followed 30-19 on June 3, 2026. The law gives NCSEAA the job of certifying qualifying SGOs, sending the list to the U.S. Treasury and posting it online.
Which organizations will hand out scholarships in the Triangle?
None are approved yet. Carolina Journal reported on September 16 that NCSEAA had not announced its SGO application process, and that its only public guidance, posted September 3, said federal regulations were not final. State law gives NCSEAA until the later of July 1, 2026 or 120 days after federal rules are published to write its own rules, so the list could arrive after donations start.
One organization has said it is preparing. NC Education Corps, a statewide tutoring nonprofit, is forming a separate SGO that schools and other groups could partner with instead of running their own, and plans to take donations from January 1, 2027.
Which Triangle students could receive an SGO scholarship?
Students who can enroll in K-12 and live in a household at or below 300% of area median income. The federal law ties the limit to the area, so a Raleigh or Durham household is measured against its own region rather than a single national number. We have not seen an official dollar figure for the Triangle under this program yet, so we are not publishing one; expect it to be well above the income lines most families think of as low-income.
Within that limit, each SGO will set its own award sizes and priorities, and state law lets SGOs fund home-school expenses to the extent federal rules allow. That could matter for Triangle home-school families who do not qualify for ESA+, since ESA+ is the only state program that pays home-school costs today. Until Treasury finishes its regulations and NCSEAA certifies SGOs, though, nobody can say how much will be available or how quickly applications will open.
If you think your family will qualify, the useful step now is simple: keep last year's tax return and proof of address handy, the same documents NCSEAA already asks for.
Tax credit vs Opportunity Scholarship vs ESA+: how do they differ?
| Federal tax credit scholarship | Opportunity Scholarship | ESA+ | |
|---|---|---|---|
| Who funds it | Private donors, credited on federal taxes | The state, through NCSEAA | The state, through NCSEAA |
| Who decides awards | Approved SGOs | NCSEAA, by income tier | NCSEAA, by disability category |
| Income rule | At or below 300% of area median income | None; amount falls as income rises | None |
| Status in Raleigh | Starts Jan 1, 2027; no SGO list yet | Paying 2026-27 awards now | Paying 2026-27 accounts now |
What the credit is not: it is not money paid to families by the state, and it is not run like the Opportunity Scholarship. A family will apply to an SGO, not to NCSEAA, once SGOs exist.
What should Raleigh donors and families do before January?
Donors can wait for NCSEAA's list before giving, since only gifts to approved SGOs earn the credit. Families should keep applying for the state programs on their normal calendar, because those are funded and running. How an SGO scholarship will stack with a state award depends on Treasury rules that are not final.
Schools and churches have their own decision to make. A Triangle school that wants donors to back its families can wait for NCSEAA's process, partner with an SGO such as the one NC Education Corps is building, or explore forming one, which brings its own reporting work. Whichever route a school picks, it should tell its families plainly which SGO it works with, so donors in its community know where a credit-eligible gift should go. We track all of this on our federal tax credit page.
Frequently asked questions
How does the federal scholarship tax credit work for Raleigh taxpayers?
A donor to an approved SGO can take a dollar-for-dollar federal credit of up to $1,700, starting with gifts made on or after January 1, 2027.
How did North Carolina opt in?
The General Assembly overrode the governor's veto of HB 87, with House and Senate votes on May 20 and June 3, 2026.
Which organizations will hand out scholarships in the Triangle?
None are approved yet; NCSEAA certifies and posts the list, and it had not opened that process as of mid-September 2026.
What should Raleigh donors and families do before January?
Donors should wait for NCSEAA's approved list, and families should keep using the state programs, which are funded and running now.
Related questions
- Did North Carolina opt into the federal scholarship tax credit?
- Which Opportunity Scholarship tier is my household in?
- Can a Raleigh home-school family get state money?
- Which funding sources can a Triangle family use?
Sources
- Ballotpedia News, NC General Assembly overrides veto of HB 87 (June 12, 2026)
- NCLEG, H87 Educational Choice for Children Act summary
- Carolina Journal, NC nonprofit moves to build statewide scholarship group (Sept 16, 2026)
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