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Advocates urge Healey to opt Massachusetts out of federal education tax credit

Advocates urge Gov. Maura Healey to opt Massachusetts out of the federal Education Freedom Tax Credit, but its effects on state schools remain uncertain.
From TheFinanceBase Team5 min to read
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Massachusetts has not been confirmed as opting in or out of the federal Education Freedom Tax Credit. The program is scheduled to begin January 1, 2027, and education and civil-rights groups are urging Gov. Maura Healey to reject participation, warning that it could deepen inequities and put added pressure on public schools. Those are advocates’ forecasts, not measured effects: the program has not launched, and no Massachusetts impact data is available.

What the Education Freedom Tax Credit would do

Under the U.S. Treasury’s proposed rules, a donor who gives cash to a qualifying scholarship-granting organization (SGO) could claim a dollar-for-dollar federal income-tax credit of up to $1,700 per person, or up to $3,400 for a married couple filing jointly. An SGO is a qualifying public charity that awards scholarships to eligible K–12 students. The maximum tax credit is not a guaranteed scholarship amount, and a student’s eligibility does not ensure an award.

Treasury describes the credit as a way to expand family choice and educational options. Treasury Secretary Scott Bessent called it “a new chapter in educational freedom and opportunity by establishing America’s first nationwide school choice incentive and empowering states to give students and families more options.” That is the administration’s rationale for the program.

Who could qualify and what scholarships could cover

Treasury says a student who is eligible to enroll in a public elementary or secondary school may qualify if household income is no more than 300% of area median gross income, adjusted for family size. Listed expenses include private or religious school tuition, tutoring, special-education services, books, supplies, and qualifying extended-day programs.

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Scholarships would depend on participating states, eligible students, donated funds, and individual SGO decisions. Treasury also says donors may give to an SGO in a participating state even if the donor’s own state has not joined. Scholarships must serve eligible students who live in a state where that SGO is listed.

What Massachusetts must decide—and what is known so far

Participation is voluntary. The Massachusetts Association of School Superintendents says Healey is the state’s sole decision-maker. The federal schedule gives states until January 1, 2027, to elect to participate; Treasury’s fact sheet says the initial list of qualifying SGOs is due February 15, 2027. As of October 7, 2026, available reporting does not confirm Healey’s decision. The federal regulations were proposed on October 1, 2026, and are not final.

If Massachusetts opts in, it would identify qualifying SGOs under the federal framework, making scholarships for eligible Massachusetts residents possible through listed organizations. If it opts out, Massachusetts residents could still donate to an SGO in another participating state, but scholarships under the program must go to eligible students residing in a state where the SGO is listed. The practical question for Massachusetts, therefore, is not simply whether its residents can claim the credit; it is whether the state will enable listed organizations to award program scholarships to eligible students living there.

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Why opponents want Massachusetts to opt out

The Massachusetts Teachers Association and a coalition of education, civil-rights, parent, and community organizations argue that the program could channel public tax revenue toward private education while weakening the public systems serving all students. Their concerns are about potential effects, not outcomes yet observed in Massachusetts.

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Unequal ability to attract donations

Critics argue that established private-school networks may be better positioned than public districts to attract donors and distribute scholarship funds. Mary Bourque, executive director of the Massachusetts Association of School Superintendents, said the program’s structure leaves public schools at a disadvantage: “The services that students in public schools can receive through scholarship funds are far more limited and can only be provided to families who apply for the scholarships and can demonstrate income eligibility.” That is Bourque’s assessment of the program’s design.

MassBudget similarly argues that the structure could advantage private schools and higher-income households. Whether that would happen in Massachusetts, and on what scale, has not been established.

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School funding, enrollment, and equity

The coalition warns that shifting donations toward scholarships could reduce resources available to public schools and exacerbate existing enrollment and equity challenges. The superintendents’ association also warns that the program could add strain to districts already dealing with declining enrollment. These are forecasts by the organizations opposing participation; there is no measured Massachusetts effect to report before the program begins.

Vatsady Sivongxay, a public-school parent and executive director of the Massachusetts Education Justice Alliance – Education Fund, said the coalition fears the program would “send our public tax dollars to private schools, defunding the public schools that serve all kids while bypassing the strong local education standards” in Massachusetts. The claim that the tax credit would produce those consequences is the coalition’s position, not a demonstrated result.

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Oversight and administrative demands

Opponents also question how much authority Massachusetts would have to screen or regulate participating SGOs under the federal rules, and whether administering the program would divert staff or other resources. The proposed rules and the concerns raised by advocates do not establish the eventual scale of any administrative burden or the safeguards the state might use. The federal regulations remain proposed.

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Why some advocates support opting in

Supporters say participation could make scholarships available to Massachusetts students for tuition, tutoring, and other eligible services. Former Boston City Councilor and public-school teacher Annissa Essaibi George argued that Massachusetts could benefit by joining rather than letting contributions flow elsewhere. As she put it, “Massachusetts taxpayers will be eligible to take advantage of this program whether the governor opts in or not. The only question is whether those dollars come back to Massachusetts children, or instead flow to students in states that moved faster.”

That argument highlights a real feature of the proposed program: a Massachusetts donor may support an SGO in another participating state even if Massachusetts opts out. But whether opting in would attract donations to Massachusetts SGOs, how much funding would reach local students, and how scholarships would affect public schools remain unknown.

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What Treasury projects—and what those estimates do not show

Treasury and the Internal Revenue Service estimated in 2026 that by 2030 the program could draw more than 11 million donors and $26 billion in annual contributions, and support 600–700 SGOs. Their scenarios also estimated about 2 million full-time scholarships averaging $12,000, or 5 million part-time scholarships averaging $4,500, per year. These are federal projections, not current participation or Massachusetts-specific forecasts; actual awards would depend on state participation, donations, and SGO decisions.

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AFT Massachusetts made a separate claim in an October 1, 2026 statement, asserting the program could involve $50 billion per year and $500 billion over 10 years. Those figures are the union’s claims and should not be confused with Treasury and IRS estimates. Neither set of projections measures how much Massachusetts schools would gain or lose.

How to assess the choice

The central trade-off is whether Massachusetts should enable a new source of scholarship funding for eligible residents despite concerns about uneven access, public-school resources, oversight, and administration. The current evidence establishes the proposed tax-credit structure and the arguments on each side, but it cannot establish the program’s eventual effects on Massachusetts schools.

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  • Potential benefit: eligible students could receive scholarships for a range of educational expenses if the state participates, donors contribute, and SGOs award funds.
  • Key uncertainty: neither the amount of money Massachusetts SGOs would attract nor the distribution of awards is known.
  • Potential risk raised by critics: scholarship funds and administrative attention could favor private-school networks and compound pressure on public districts; these effects are not yet measured.
  • Decision status: Healey’s choice had not been confirmed in available reporting as of October 7, 2026; the state election deadline is January 1, 2027.

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