Programs

The Educational Opportunities Act created the School Tuition Organization (STO) Tax Credit Program in 2006. Here are the highlights:

• Low to lower-middle income families may receive a tuition grant from a School Tuition Organization (STO) to attend the accredited, nonpublic school of their choice.
• Donors to the program receive a 75% state income tax credit, and can also claim a portion of their donation as a charitable contribution on their Federal income tax.
• Between 2006 and 2020. the STO Program distributed just under $186 million to students, allowing them to afford the school of their choice.
• Over 12,000 students receive grants every year.
• See the STO Directory to contact an STO, apply for a grant or learn how to donate.
• Download the helpful one page summary on how STO works.

Enacted in 1987 and expanded during the 2021 Iowa state legislative session, this state income tax credit now gives parents of public, private and home school students a tax credit to help with educational expenses:

• Effective for tax year 2021: Tax credit is equal to maximum 25% of the first $2,000 (up to $500) paid for each child in grades K-12 for tuition and textbooks, each school year.
• Definition of “textbooks” includes expenses for materials used in extra-curriculars such as drama, sports, driver’s education, and similar programs.
• Parents claim this credit on their Iowa income tax return.
• This program helps parents offset some of the expense of choosing private education options, as well as all the extras of public education.
• This tax credit is available to parents of public, private and home school students

• In certain circumstances, parents may open enroll their student to a public school district other than the district in which they live.  Parents should consult the administration at the district where they’d like to send their children for further assistance.
• During the 2021 legislative session, Iowa law was greatly expanded to allow for the creation of public charter schools in the coming years.

While we do not have Educational Savings Accounts yet in Iowa, we hope the Iowa legislature will make ESAs a reality in the near future.

• Potentially every Iowa student would be eligible to receive a grant equal to a portion of the state per-pupil funding.
• Students would use that grant for educational expenses such as private school tuition, textbooks, tutoring, and online learning.
• All students would be eligible regardless of their income level.
• Any funds not used by graduation could be used for tuition at an Iowa college or university.
• This program would allow true, universal school choice and inject the positive force of market competition into the Iowa educational arena.
• Download the helpful summary document on how ESAs work.