Who Decides If Pennsylvania Joins the Federal Scholarship Credit, and When?

Starting January 1, 2027, people who give to private school scholarship funds can claim a new federal income tax credit, but only in states that choose to join the program. The funds turn those gifts into K-12 scholarships for families that meet an income test. Pennsylvania has not joined. If it doesn't join by January 1, 2027, no student living here can receive one of those scholarships in 2027.

The federal credit is separate from Pennsylvania's own two scholarship tax credits, EITC and OSTC.

Two things about the decision to join are useful to know. The decision is not necessarily the Governor's alone, and the deadline for joining is January 1, 2027, the same day the program starts.

Federal law lets a state's governor or any individual or agency designated by state law make this choice. That means Gov. Josh Shapiro can opt the state in, but so could Pennsylvania's legislature if it passes a law electing to join.

Gov. Shapiro said during an October debate that he is "very open" to joining and has directed state agencies to determine how the program would work under the federal requirements. His office had earlier said it was awaiting federal guidance, and he has signaled he may wait until after the midterm elections to decide.

State Treasurer Stacy Garrity, who is running against him for governor, has said she would opt Pennsylvania in on her first day in office.

The legislative route has a first step on record. On August 5, 2026, six state senators filed a co-sponsorship memo announcing the intent to create legislation to opt Pennsylvania in. The sponsors of memo 49085 are President Pro Tempore Kim Ward, Majority Leader Joe Pittman, Appropriations Chair Scott Martin, Education Committee Chair Lynda Schlegel Culver, and Sen. Judy Ward, all Republicans, and Sen. Anthony Williams, a Democrat.

As of mid-October, no bill had been introduced. Once a bill is introduced, it would need to pass the Senate and the state House and then be signed by the Governor, become law without a signature, or pass over a veto.

While the program starts January 1, 2027, and this is the deadline for a state to join, the list of scholarship granting organizations it approves is not due until February 15, 2027.

From 2028 on, the schedule moves earlier: A state must choose between January 2 and September 30 of the preceding year and submit its list by January 1 of the year the credit applies.

A state that does not submit its list by February 15, 2027 has no organizations that qualify for the program in 2027, and no student living there can receive a scholarship funded through the federal credit that year.

If a state adds organizations to its list after February 15, 2027, they are not eligible to receive gifts that get the donors federal tax credits until January 1, 2028.

Any opt-in bill will be listed on the legislature's website by number once it is introduced, making it publicly available to follow. The IRS also lists participating states on its Federal Scholarship Tax Credit website.