Montana has formally opted in to a new Federal Tax Credit Scholarship Program, opening the door for taxpayers to receive a federal tax credit when they donate to nonprofit organizations that provide K–12 scholarships. State officials say the move will expand education options for families and build on Montana’s existing school choice initiatives.
The program was created under the One Big Beautiful Bill Act, signed into law by President Donald J. Trump in July 2025. Among its provisions is a federally funded tax credit scholarship program for elementary and secondary education, which is set to take effect on January 1, 2027.
“Opting in to this program gives Montanans another incentive to support the success of the next generation,” Gov. Greg Gianforte said in a statement. “Thanks to President Trump, we’re building on Montana’s successful programs that provide children with more educational opportunities and we’re expanding education freedom, giving more students and parents the ability to choose the learning path that works best for them.”
Under the Federal Tax Credit Scholarship Program, Montana taxpayers may claim a nonrefundable federal tax credit of up to $1,700 for donations made to approved Scholarship Granting Organizations (SGOs). These nonprofit organizations use contributions to award scholarships to K–12 students.
Scholarship funds may be used for a range of education-related expenses, including tuition, books, room and board, tutoring services, computers, and other approved costs intended to meet individual student needs. Supporters say the flexibility allows families to tailor educational choices to their children, whether in public, private, or alternative learning environments.
State leaders noted that the new federal program complements Montana’s existing Student Scholarship Organization (SSO) Tax Credit. That state-level program allows taxpayers to receive a tax credit equal to their donation to an approved SSO, up to $200,000 per taxpayer, until the statewide annual cap is reached. Donations through the SSO program help fund scholarships for eligible students attending qualified education providers.
By opting in to the federal program, Montana joins other states seeking to leverage federal incentives to expand education choice while encouraging private donations to scholarship organizations. Officials say the combined state and federal credits are expected to increase scholarship funding and broaden access to educational opportunities for Montana families.