Mississippians will soon be able to participate in a school-choice tax credit program. Here’s what to know

By Devna Bose | Originally published by Mississippi Today

Starting next year, Mississippi families can get a break on their taxes for donating to scholarships that will largely benefit private schools, experts say. 

The federal program, created by President Donald Trump’s 2025 “One Big Beautiful Bill Act,” will give people a break on their taxes for contributing to scholarships that can pay for education expenses at private schools, charter schools or public schools. Experts expect most of the money will flow toward private schools and families who could already afford, or were on the cusp of being able to afford, a private school education. 

Proponents of school-choice policies — which are aimed at giving families more educational options, often funding those choices with public money — say it’s a win for the state. 

But school-choice opponents argue the policies siphon money away from the public education system, which must serve every child, and force Mississippi into a program its residents have already said they don’t want. 

Republican state lawmakers, led by House Speaker Jason White, made a full-court push to expand school-choice policies in Mississippi earlier this year. However, House Bill 2, his lengthy school-choice bill, passed by a thin margin in the House and was killed by the Senate. 

Before that, in January, Gov. Tate Reeves announced that Mississippi would be participating in the federal tax credit scholarship program starting in 2027. States must opt in to that program. 

Douglas Carswell described it as an “awesome” program that allows the state to correct the Senate’s failure to expand school-choice options. He heads up the Mississippi Center for Public Policy, a conservative think tank that backs the expansion of school-choice policies.

Nancy Loome, a public school advocate and founder of The Parents’ Campaign, disagrees with Reeves’ decision. 

“Voters made it clear when House Bill 2 was debated in the 2026 legislative session that they don’t want this,” she said.

How does the federal tax credit program work?

The federal program allows taxpayers to contribute up to $1,700 each, or $3,400 for a married couple filing jointly, to an organization that awards school scholarships.

The governor designates scholarship-granting organizations, or SGOs, to award money to a school to cover costs of a child’s education. Taxpayers can’t direct their money to a particular student or school, but SGOs can focus on a particular group of students, like students who attend religious private schools. 

Reeves has not yet finalized his list of SGOs for Mississippi, according to the Mississippi Center for Public Policy, which is tracking and publishing the state’s eligible SGOs. The governor’s office did not respond to multiple requests for comment. 

Donors will get a dollar-for-dollar tax credit, a break on their taxes equal to the amount they contribute, which is about three times as much as people receive from donating to a children’s hospital or other causes. 

Families who earn up to 300% of the area’s median income qualify to participate in the scholarship program. That’s six figures in Mississippi, or about $150,000. 

Paige Shoemaker DeMio, a senior policy analyst at Center for American Progress, a progressive policy and research institute, said the people who will benefit those most from the tax credit program are wealthy and owe $1,700 or more in taxes. Research about existing state tax credit scholarship programs back that up. 

“Statistically, people who are higher income owe that much in taxes,” she said.

There’s no set amount for the scholarships. The scholarship-granting organization sets the amount. 

And across the country, school-choice scholarships and vouchers provide anywhere between $4,000 to $9,000. Nationally, private school tuition averages about $13,000. That means while federal scholarships may make it easier for families on the cusp of being able to afford private schools, that education still may be unaffordable to the neediest families.

Will federal tax credit scholarships help students from low-income families?

There’s no requirement to prioritize the scholarships for low-income students. A majority of private school vouchers across the country go to students who could already afford and were attending private schools, according to research.

Carswell recognized the reality that the scholarships may miss low-income students. 

“We need to ensure that we have SGOs that provide access to private education for low-income families, too,” he said. “That’s why we need a broad range of SGOs that offer smaller schools, and not just established ones, access to the new source of funding.”

However, the governor has little power to tailor the program to the state’s students, Shoemaker DeMio said.

The federal regulations require Reeves to approve any SGOs that meet the minimum requirements. He can’t impose additional reporting or standards.

The lack of transparency and reporting requirements is a “huge lost opportunity,” said Mike Petrilli of the Fordham Institute, a national conservative-leaning education policy think tank.

“It’s very much a light touch,” he said. “We may never know if this is making a difference for kids.”

How will tax credit scholarships for private schools affect public ones?

There’s been some movement nationally to use the program to divert money to public schools, including public charter schools, Shoemaker DeMio said, but it’s tricky to understand how that would play out. Public schools do not charge students to attend. 

And the federal guidance regulating that part of the program hasn’t been made public yet, she said. It’s also unclear how much it will cost states to administer the program, which could include monitoring fraud, reviewing audits and other duties. 

The U.S. Department of Treasury estimates the tax-credit scholarship program, which begins all over the country in 2027, will cost taxpayers $26 billion in its first three years. That would make it the federal government’s largest education expense — more than Title I, which ensures that economically disadvantaged children receive a high-quality education, and the Individuals with Disabilities Education Act, which guarantees children with disabilities receive an equitable education.

“We’d be spending as a country more on private schools than any other (public education) program,” Shoemaker DeMio said. That could mean spending less on public education in the future, which could be especially detrimental to a state like Mississippi that heavily relies on federal funding. 

But most concerning to DeMio is that Mississippi voters have already rejected school-choice programs through legislative action. 

“Any time school choice has been on a ballot, it has failed,” she said. “This is clearly not a popular program, but people have now found a way to get around the voters and ignore what Americans want. It’s incredibly frustrating.”

This article was originally published by Mississippi Today and is republished here under a Creative Commons license.

Source: Original Article