Kentucky has officially opted in to the scholarship tax credit program that is part of the 2025 One Big Beautiful Bill Act. Secretary of State Michael Adams signed the documentation with the Internal Revenue Service during a news conference on Wednesday. Gov. Andy Beshear had vetoed the measure, but the veto was overridden by the Republican-dominated General Assembly.
Kentucky families will soon be able to take advantage of the dollar-for-dollar federal tax credit of up to $1,700 per year for contributions to approved Scholarship Granting Organizations. These actions will position Kentucky students to benefit from the federal program, which will cover a variety of educational costs for books, instruction materials, tutoring and academic programs.
Adams also signed a state regulation to establish the procedures for submitting, reviewing, and processing filings for Scholarship Granting Organizations (SGO) in Kentucky.
“This President, Congress, General Assembly and Secretary of State have Kentucky students’ backs,” Adams. said “All eligible Kentucky students – public, private and home-schooled – will soon have access to better and more affordable education.”
State Rep. Kim Moser, R-Taylor Mill, the primary sponsor of House Bill 1, said she appreciated Adams’ work on the regulations. “Now the work shifts from Frankfort to our communities. This program will only succeed if Kentuckians step forward. I encourage community leaders, nonprofit organizations, business leaders, philanthropists and individuals to consider establishing Scholarship Granting Organizations or supporting those that do. Our students in public and private schools will see the benefit.”
With the regulation filed Wednesday, nonprofit entities and foreign nonprofit entities with confirmed tax-exempt 501(c)(3) public charity status may file the SGO declaration form in person or by mail, with an online filing option through the Secretary of State’s Fast Track website to be available shortly.
Kentucky’s list of SGOs will be sent to the federal government by January 1, 2027, when SGOs can begin receiving qualifying donations. The federal tax credit will apply to qualifying contributions made during the 2027 tax year after Kentucky’s list of SGOs is submitted to the IRS, and taxpayers may claim and receive the credit when filing their 2027 federal income tax returns in 2028.
Kentucky Secretary of State Michael Adams
