High-Quality Charter Schools Act
Sponsored By: Senator Scott, Tim [R-SC]
In Committee
Summary
Would create a 75% individual tax credit for donations to vetted charter school organizations to steer private funding toward high-quality charter schools.
Show full summary
It would pair the credit with strict audit, spending, and allocation rules and a $5 billion annual cap starting in 2026.
- Donors: Individuals would get a nonrefundable credit equal to 75% of qualified cash or marketable securities donations, capped at the greater of 10% of adjusted gross income or $5,000. The credit disallows a separate charitable deduction and unused credits may roll forward up to 5 years.
- Charter organizations: Eligible entities must be 501(c)(3) charter management organizations or charter schools that meet performance or grant-based tests. They must keep separate accounting, undergo annual independent audits, certify completion, and meet a spending test with clawbacks if contributions are not spent by the first day of the fifth taxable year. Administrative expenses have a 10% safe harbor and up to 15% of contributions may carry to the next year.
- State allocations and limits: The program would be capped at $5 billion nationwide with a $10 million initial allotment for each State. Credits would be allocated first-come, first-serve through a real-time tracking system and the cap can increase by 5% the next year if 90% of credits are claimed.
Effective for taxable years beginning after December 31, 2025.
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Bill Overview
Analyzed Economic Effects
2 provisions identified: 0 benefits, 0 costs, 2 mixed.
Big tax credit for charter donations
If enacted, you would be able to claim a federal tax credit equal to 75% of cash or marketable securities you give to eligible charter school groups. The credit would be nonrefundable and capped each year at the greater of 10% of your adjusted gross income or $5,000. Unused credit amounts could be carried forward up to five taxable years and would be used first‑in, first‑out. You would not be able to also take a charitable deduction under section 170 for the same gift. Credits would be subject to a $5 billion annual nationwide cap, a $10 million per‑State base allocation, and first‑come, first‑served award rules tracked in real time. These rules would apply to tax years beginning after December 31, 2025.
Rules for which charter groups qualify
If enacted, only certain 501(c)(3) public charities that are charter management organizations or charter schools would qualify to receive donations that generate the credit. Eligible groups would need to meet grant‑ or top‑performance criteria, keep separate accounting for creation/expansion gifts, obtain annual audits from an independent certified public accountant, and certify those audits to the Secretary. Private foundations would be excluded. These rules would apply to tax years beginning after December 31, 2025.
Sponsors & CoSponsors
Sponsor
Scott, Tim [R-SC]
SC • R
Cosponsors
Sen. Cassidy, Bill [R-LA]
LA • R
Sponsored 6/4/2025
Sen. Tuberville, Tommy [R-AL]
AL • R
Sponsored 4/13/2026
Sen. Scott, Rick [R-FL]
FL • R
Sponsored 4/28/2026
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov