Armstrong: ND to participate in federal tax credit for donations to Scholarship Granting Organizations

BISMARCK, N.D. - North Dakota will participate in a new federal program that offers a tax credit for certain donations to organizations that provide K-12 education scholarships and services, Gov. Kelly Armstrong announced today.

The tax credit applies to cash contributions to Scholarship Granting Organizations, or SGOs, which are nonprofits that award scholarships to help students pay for elementary and secondary education. Taxpayers may be able to claim the federal tax credit beginning Jan. 1, 2027.

"This program incentivizes charitable giving to support our state's most precious resource - its students," Armstrong said. "We look forward to implementing the program with additional federal guidance to empower school choice and support North Dakota students in their education."

The program was established in the One Big Beautiful Bill Act passed by Congress and signed by President Trump last year. Before the tax credit can be claimed, the state must choose to participate in the program and submit a list of approved SGOs to the U.S. Treasury Department. To qualify, an SGO must be recognized as a 501(c)(3) public charity and may not be a private foundation. Eligible covered expenses include tuition, tutoring, special needs supports, technology costs and public education supplemental services for students enrolled in public or private schools. Income limits apply, and the maximum annual credit is $1,700 per taxpayer, per year.

State Superintendent of Public Instruction Levi Bachmeier encouraged parents with children in school to familiarize themselves with the tax credit, calling it an exciting opportunity.

"Thousands of students attending public and private schools will benefit from the funds enabled by this tax credit," Bachmeier said. "I appreciate Governor Armstrong's leadership to unleash more resources to support our students as North Dakota works to lead the nation with America's best schools."

Additional program guidance from Treasury is pending, and more information about the program, including a list of eligible SGOs in North Dakota, will be released as it becomes available. The tax credit is nonrefundable, which means it can reduce federal income tax liability but won't result in a refund if the credit is larger than what the individual owes.