Sandy-area families could tap a new federal scholarship program starting in 2027 after Utah opted into the Education Freedom Tax Credit.
U.S. Secretary of Education Linda McMahon promoted the credit at American Preparatory Academy, a Salt Lake City charter school, on Tuesday, Oct. 20. The event kicked off a national speaking series she called "The Next 250: American Education," ABC4 reported.
The U.S. Department of Education said McMahon chose Utah as her first stop partly because the state is among those that have opted into the credit. ABC4 reported 31 states have opted in. A THE Journal explainer published Sept. 24 put the count at 30, noting some states were waiting for final Treasury Department guidance.
The credit takes effect Jan. 1, 2027. Eligible taxpayers may claim up to $1,700 per person, or up to $3,400 for married couples filing jointly, for cash contributions to nonprofit Scholarship Granting Organizations (SGOs).
Those SGOs then award scholarships to K-12 students for tuition, tutoring, special education services, books and supplies, according to a Department of Education fact sheet. The credit is nonrefundable but can be carried forward up to five years.
Students qualify if their household income falls within 300% of the area's median gross income. The Treasury Department estimated about 95% of American children live in households that meet that threshold.
Utah has opted into the program, making Canyons School District families eligible for scholarships funded through the credit. Federal sources accounted for 7.7% of Canyons' revenue during the 2022-23 school year, according to USAFacts. Statewide, Utah public schools received $1,113 per student from the federal government during the 2023-24 school year.
The department's fact sheet stated the credit "does not divert money from local or state taxes" and instead encourages voluntary charitable giving. By 2030, Treasury and IRS estimate 11 million donors could contribute $26 billion annually to SGOs nationwide, funding roughly 2 million full-time scholarships.
McMahon said the department had been "reset." The administration redirected money away from diversity, equity and inclusion (DEI) programs and toward reading, writing, math and critical thinking, according to ABC4.
"As we right-size federal involvement in education, this administration has fundamentally shifted decision-making in this country … placing it back with those who know best how to meet students' day-to-day learning needs: teachers, local, and state education leaders," McMahon said.
U.S. Rep. Burgess Owens, R-Utah, also backed the credit, urging attendees to watch how the program plays out as parents gain more choices.
McMahon has shifted programs such as the Office of Elementary and Secondary Education to the Department of Labor and the Indian Education Program to the Department of the Interior. Closing the department would require an act of Congress.
Canyons School District is already navigating a heavy load of state education policy changes. At the board's March 31 meeting, External Relations Director Charlie Evans reported that 240 of the 1,021 bills introduced during the 2026 Utah legislative session directly affect district operations. Among the fiscal impacts: a 4.2% increase to the Weighted Pupil Unit and a $25 million statewide boost to at-risk student programs, with $1.3 million going to Canyons.
For 2027, states must submit advance election forms to the IRS by Jan. 1 and their lists of qualifying SGOs by Feb. 15.
