School Tuition Organization Tax Credit

Eligible students may receive a scholarship to attend an accredited Iowa nonpublic school if their family household income does not exceed 400% of the Federal Poverty Level or FPL ($124,800 for a family of four in 2024–2025). _(Last updated July 15, 2024)_

STOs provide scholarships called “tuition grants” to cover all, or part, of the tuition at an accredited Iowa nonpublic school participating in the program. _(Last updated July 15, 2024)_

The program is funded by donations to STOs. Scholarship amounts are determined by STOs and capped only by a participating student’s annual tuition amount. Eligible donors include individuals and corporations. Donor contributions to STOs are worth 75% of the value, with an annual maximum equal to the donor’s tax liability. Any credit in excess of the tax liability is not refundable, but the excess for the tax year may be credited to the tax liability for the following five tax years or until depleted, whichever is earlier. A maximum of $20 million in tax-credit funding for scholarships is available annually. Total credits claimed cannot exceed $20 million, meaning roughly 9,700 students can participate, or less than 2% of Iowa’s K–12 student population. _(Last updated July 15, 2024)_

No legal challenges have been filed against the program. _(Last updated July 15, 2024)_