News Release: MCC Calls on State to Opt in to Federal Education Tax Credit

(Lansing, Mich.)—Michigan Catholic Conference is calling on the state to opt in to the Federal Education Tax Credit, a measure that would make substantial financial support available to public and nonpublic school families facing out-of-pocket education expenses, without impacting the state School Aid Fund.

“Families are facing significant affordability challenges in today’s economy, and this credit can help reduce the financial burden of out-of-pocket education costs for families with children in public or nonpublic schools. It is a win-win in every respect,” said MCC policy advocate Paul Stankewitz.

The federal policy requires each state to opt in to the program that offers up to a $1,700 federal tax credit to individuals who make donations to a Scholarship Granting Organization (SGO). In turn, SGOs will use those donations to provide direct financial assistance to public and nonpublic school students for a range of education-related expenses, including supplies, technology, tuition, and academic tutoring. Assistance would be available to families earning no more than 300 percent of the area’s median income.

“Because this is a federal policy, it does not affect the state School Aid Fund that provides per-pupil funding to public school districts, nor does it conflict with the state constitutional ban on tax credits or other support for nonpublic school families,” Stankewitz said. “Voters and residents across party lines broadly support the policy once they understand how it works and that public and nonpublic students alike could benefit.”

Last week, Marketing Resource Group (MRG) released data from its March statewide poll that indicates 72 percent of voters support the state opting in to the federal policy. That includes, according to MRG, 79 percent of Democrats, 71 percent of Republicans, and 68 percent of Independents.

“Failing to opt in means that Michigan students will lose out,” said Stankewitz. “As additional IRS guidance is expected as soon as next month, we urge policymakers on both sides of the aisle to work together in the best interest of families and affirm the state’s support for every student. We encourage Michigan to participate in this educational opportunity as it is sound public policy that will benefit our state.”

With the governor of New York signaling last week that her state is likely to participate, some 30 states with both Republican and Democratic governors are now poised to welcome direct assistance to students when the broadly supported Federal Education Tax Credit takes effect on January 1, 2027.

Michigan Catholic Conference is the official public policy voice of the Catholic Church in this state.

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