North Dakota will participate in a new federal program offering tax credits for donations to organizations that provide K-12 education scholarships, Governor Kelly Armstrong announced Wednesday.
The program allows taxpayers to claim federal tax credits for cash contributions to Scholarship Granting Organizations (SGOs), nonprofit groups that award scholarships to help students pay for elementary and secondary education. North Dakota residents will be eligible to claim the credit starting Jan. 1, 2027.
“This program incentivizes charitable giving to support our state’s most precious resource – its students,” Governor Armstrong said. “We look forward to implementing the program with additional federal guidance to empower school choice and support North Dakota students in their education.”
The initiative was established under the One Big Beautiful Bill Act, passed by Congress and signed by President Trump last year. Before taxpayers can claim the credit, North Dakota must officially participate and submit a list of approved SGOs to the U.S. Treasury Department.
To qualify, an SGO must be recognized as a 501(c)(3) public charity and may not be a private foundation. Donations can cover tuition, tutoring, special needs support, technology costs, and supplemental educational services for students enrolled in either public or private schools. Income limits apply, and the maximum federal credit is $1,700 per taxpayer per year.
State Superintendent of Public Instruction Levi Bachmeier said the program provides a meaningful opportunity to expand educational support.
“Thousands of students attending public and private schools will benefit from the funds enabled by this tax credit,” Bachmeier said. “I appreciate Governor Armstrong’s leadership to unleash more resources to support our students as North Dakota works to lead the nation with America’s best schools.”
Additional guidance from the Treasury Department is pending. Officials said a list of eligible SGOs in North Dakota and further details about the program will be released once finalized. The credit is nonrefundable, meaning it can reduce federal income tax liability but will not generate a refund if the credit exceeds the taxpayer’s liability.
The program marks a significant step in expanding school choice and funding options for North Dakota families, providing a new avenue for private contributions to directly benefit students’ education.