Us Congress 2025-2026 Regular Session

Us Congress House Bill HB833 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	I
2	2	119THCONGRESS
3	3	1
4	4	STSESSION H. R. 833
5	5	To amend the Internal Revenue Code of 1986 to allow a credit against
6	6	tax for charitable donations to nonprofit organizations providing edu-
7	7	cation scholarships to qualified elementary and secondary students.
8	8	IN THE HOUSE OF REPRESENTATIVES
9	9	JANUARY31, 2025
10	10	Mr. S
11	11	MITHof Nebraska (for himself, Mr. OWENS, Mr. WALBERG, Mr. KELLY
12	12	of Pennsylvania, Mr. Y
13	13	AKYM, Mr. LAHOOD, Ms. LETLOW, Mrs. MILLER-
14	14	M
15	15	EEKS, Mr. DONALDS, Ms. TENNEY, Mr. MOOREof Utah, Mr.
16	16	F
17	17	EENSTRA, Ms. MALLIOTAKIS, Mr. HERNof Oklahoma, Mr. LAWLER,
18	18	Mr. F
19	19	ONG, Mr. CAREY, Mr. HUDSON, Ms. SALAZAR, Mr. SCOTTFRANK-
20	20	LINof Florida, Mr. CRENSHAW, Mr. WILSONof South Carolina, Mr.
21	21	R
22	22	OSE, Mr. WEBERof Texas, Mr. CISCOMANI, Mr. MOOLENAAR, Mr.
23	23	A
24	24	LLEN, Mr. DUNNof Florida, Mr. MURPHY, Mr. CLINE, Mr. MEUSER,
25	25	Mr. T
26	26	IMMONS, and Mr. BERGMAN) introduced the following bill; which
27	27	was referred to the Committee on Ways and Means, and in addition to
28	28	the Committee on Education and Workforce, for a period to be subse-
29	29	quently determined by the Speaker, in each case for consideration of such
30	30	provisions as fall within the jurisdiction of the committee concerned
31	31	A BILL
32	32	To amend the Internal Revenue Code of 1986 to allow a
33	33	credit against tax for charitable donations to nonprofit
34	34	organizations providing education scholarships to quali-
35	35	fied elementary and secondary students.
36	36	Be it enacted by the Senate and House of Representa-1
37	37	tives of the United States of America in Congress assembled, 2
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40	40	•HR 833 IH
41	41	SECTION 1. SHORT TITLE. 1
42	42	This Act may be cited as the ‘‘Educational Choice 2
43	43	for Children Act of 2025’’. 3
44	44	SEC. 2. TAX CREDIT FOR CONTRIBUTIONS TO SCHOLAR-4
45	45	SHIP GRANTING ORGANIZATIONS. 5
46	46	(a) C
47	47	REDIT FORINDIVIDUALS.— 6
48	48	(1) I
49	49	N GENERAL.—Subpart A of part IV of sub-7
50	50	chapter A of chapter 1 of the Internal Revenue Code 8
51	51	of 1986 is amended by inserting after section 25E 9
52	52	the following new section: 10
53	53	‘‘SEC. 25F. QUALIFIED ELEMENTARY AND SECONDARY EDU-11
54	54	CATION SCHOLARSHIPS. 12
55	55	‘‘(a) A
56	56	LLOWANCE OFCREDIT.—In the case of an in-13
57	57	dividual who is a citizen or resident of the United States 14
58	58	(as defined in section 7701(a)(9)), there shall be allowed 15
59	59	as a credit against the tax imposed by this chapter for 16
60	60	the taxable year an amount equal to the aggregate amount 17
61	61	of qualified contributions made by the taxpayer during the 18
62	62	taxable year. 19
63	63	‘‘(b) L
64	64	IMITATIONS.— 20
65	65	‘‘(1) I
66	66	N GENERAL.—The credit allowed under 21
67	67	subsection (a) to any taxpayer for any taxable year 22
68	68	shall not exceed an amount equal to the greater of— 23
69	69	‘‘(A) 10 percent of the adjusted gross in-24
70	70	come of the taxpayer for the taxable year, or 25
71	71	‘‘(B) $5,000. 26
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75	75	‘‘(2) ALLOCATION OF VOLUME CAP .—The credit 1
76	76	allowed under subsection (a) to any taxpayer for any 2
77	77	taxable year shall not exceed the amount of the vol-3
78	78	ume cap allocated by the Secretary to such taxpayer 4
79	79	under section 3 of the Educational Choice for Chil-5
80	80	dren Act of 2025 with respect to qualified contribu-6
81	81	tions made by the taxpayer during the taxable year. 7
82	82	‘‘(3) R
83	83	EDUCTION BASED ON STATE CREDIT .— 8
84	84	The amount allowed as a credit under subsection (a) 9
85	85	for a taxable year shall be reduced by the amount 10
86	86	allowed as a credit on any State tax return of the 11
87	87	taxpayer for qualified contributions made by the tax-12
88	88	payer during the taxable year. 13
89	89	‘‘(c) D
90	90	EFINITIONS.—For purposes of this section— 14
91	91	‘‘(1) E
92	92	LIGIBLE STUDENT.—The term ‘eligible 15
93	93	student’ means an individual who— 16
94	94	‘‘(A) is a member of a household with an 17
95	95	income which is not greater than 300 percent 18
96	96	of the area median gross income (as such term 19
97	97	is used in section 42), and 20
98	98	‘‘(B) is eligible to enroll in a public ele-21
99	99	mentary or secondary school. 22
100	100	‘‘(2) Q
101	101	UALIFIED CONTRIBUTION .—The term 23
102	102	‘qualified contribution’ means a charitable contribu-24
103	103	tion (as defined by section 170(c)) to a scholarship 25
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106	106	•HR 833 IH
107	107	granting organization in the form of cash or market-1
108	108	able securities. 2
109	109	‘‘(3) Q
110	110	UALIFIED ELEMENTARY OR SECONDARY 3
111	111	EDUCATION EXPENSE .—The term ‘qualified elemen-4
112	112	tary or secondary education expense’ means the fol-5
113	113	lowing expenses in connection with enrollment or at-6
114	114	tendance at, or for students enrolled at or attending, 7
115	115	a public or private elementary or secondary school 8
116	116	(including a religious elementary or secondary 9
117	117	school): 10
118	118	‘‘(A) Tuition. 11
119	119	‘‘(B) Curricula and curricular materials. 12
120	120	‘‘(C) Books or other instructional mate-13
121	121	rials. 14
122	122	‘‘(D) Online educational materials. 15
123	123	‘‘(E) Tuition for tutoring or educational 16
124	124	classes outside of the home, including at a tu-17
125	125	toring facility, but only if the tutor or instruc-18
126	126	tor is not related to the student and— 19
127	127	‘‘(i) is licensed as a teacher in any 20
128	128	State, 21
129	129	‘‘(ii) has taught at— 22
130	130	‘‘(I) a public or private elemen-23
131	131	tary or secondary school, or 24
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134	134	•HR 833 IH
135	135	‘‘(II) an institution of higher 1
136	136	education (as defined in section 2
137	137	101(a) of the Higher Education Act 3
138	138	(20 U.S.C. 1001(a)), or 4
139	139	‘‘(iii) is a subject matter expert in the 5
140	140	relevant subject. 6
141	141	‘‘(F) Fees for a nationally standardized 7
142	142	norm-referenced achievement test, an advanced 8
143	143	placement examination, or any examinations re-9
144	144	lated to admission to an institution of higher 10
145	145	education. 11
146	146	‘‘(G) Fees for dual enrollment in an insti-12
147	147	tution of higher education. 13
148	148	‘‘(H) Educational therapies for students 14
149	149	with disabilities provided by a licensed or ac-15
150	150	credited practitioner or provider, including oc-16
151	151	cupational, behavioral, physical, and speech-lan-17
152	152	guage therapies. 18
153	153	Such term shall include expenses for the purposes 19
154	154	described in subparagraphs (A) through (H) in con-20
155	155	nection with a home school (whether treated as a 21
156	156	home school or a private school for purposes of ap-22
157	157	plicable State law). 23
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161	161	‘‘(4) SCHOLARSHIP GRANTING ORGANIZA -1
162	162	TION.—The term ‘scholarship granting organization’ 2
163	163	means any organization— 3
164	164	‘‘(A) which— 4
165	165	‘‘(i) is described in section 501(c)(3) 5
166	166	and exempt from tax under section 501(a), 6
167	167	and 7
168	168	‘‘(ii) is not a private foundation, 8
169	169	‘‘(B) substantially all of the activities of 9
170	170	which are providing scholarships for qualified 10
171	171	elementary or secondary education expenses of 11
172	172	eligible students, 12
173	173	‘‘(C) which prevents the co-mingling of 13
174	174	qualified contributions with other amounts by 14
175	175	maintaining one or more separate accounts ex-15
176	176	clusively for qualified contributions, and 16
177	177	‘‘(D) which either— 17
178	178	‘‘(i) meets the requirements of sub-18
179	179	section (d), or 19
180	180	‘‘(ii) pursuant to State law, was able 20
181	181	(as of the date of the enactment of this 21
182	182	section) to receive contributions that are 22
183	183	eligible for a State tax credit if such con-23
184	184	tributions are used by the organization to 24
185	185	provide scholarships to individual elemen-25
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188	188	•HR 833 IH
189	189	tary and secondary students, including 1
190	190	scholarships for attending private schools. 2
191	191	‘‘(d) R
192	192	EQUIREMENTS FOR SCHOLARSHIPGRANTING 3
193	193	O
194	194	RGANIZATIONS.— 4
195	195	‘‘(1) I
196	196	N GENERAL.—An organization meets the 5
197	197	requirements of this subsection if— 6
198	198	‘‘(A) such organization provides scholar-7
199	199	ships to 2 or more students, provided that not 8
200	200	all such students attend the same school, 9
201	201	‘‘(B) such organization does not provide 10
202	202	scholarships for any expenses other than quali-11
203	203	fied elementary or secondary education ex-12
204	204	penses, 13
205	205	‘‘(C) such organization provides a scholar-14
206	206	ship to eligible students with a priority for— 15
207	207	‘‘(i) students awarded a scholarship 16
208	208	the previous school year, and 17
209	209	‘‘(ii) after application of clause (i), 18
210	210	any such students who have a sibling who 19
211	211	was awarded a scholarship from such orga-20
212	212	nization, 21
213	213	‘‘(D) such organization does not earmark 22
214	214	or set aside contributions for scholarships on 23
215	215	behalf of any particular student, 24
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219	219	‘‘(E) such organization takes appropriate 1
220	220	steps to verify the annual household income and 2
221	221	family size of eligible students to whom it 3
222	222	awards scholarships, and limits them to a mem-4
223	223	ber of a household for which the income does 5
224	224	not exceed the amount established under sub-6
225	225	section (c)(1)(A), 7
226	226	‘‘(F) such organization— 8
227	227	‘‘(i) obtains from an independent cer-9
228	228	tified public accountant annual financial 10
229	229	and compliance audits, and 11
230	230	‘‘(ii) certifies to the Secretary (at such 12
231	231	time, and in such form and manner, as the 13
232	232	Secretary may prescribe) that the audit de-14
233	233	scribed in clause (i) has been completed, 15
234	234	and 16
235	235	‘‘(G) no officer or board member of such 17
236	236	organization has been convicted of a felony. 18
237	237	‘‘(2) I
238	238	NCOME VERIFICATION.—For purposes of 19
239	239	paragraph (1)(E), review of all of the following (as 20
240	240	applicable) shall be treated as satisfying the require-21
241	241	ment to take appropriate steps to verify annual 22
242	242	household income: 23
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245	245	•HR 833 IH
246	246	‘‘(A) Federal and State income tax returns 1
247	247	or tax return transcripts with applicable sched-2
248	248	ules for the taxable year prior to application. 3
249	249	‘‘(B) Income reporting statements for tax 4
250	250	purposes or wage and income transcripts from 5
251	251	the Internal Revenue Service. 6
252	252	‘‘(C) Notarized income verification letter 7
253	253	from employers. 8
254	254	‘‘(D) Unemployment or workers compensa-9
255	255	tion statements. 10
256	256	‘‘(E) Budget letters regarding public as-11
257	257	sistance payments and Supplemental Nutrition 12
258	258	Assistance Program (SNAP) payments includ-13
259	259	ing a list of household members. 14
260	260	‘‘(3) I
261	261	NDEPENDENT CERTIFIED PUBLIC AC -15
262	262	COUNTANT.—For purposes of paragraph (1)(F), the 16
263	263	term ‘independent certified public accountant’ 17
264	264	means, with respect to an organization, a certified 18
265	265	public accountant who is not a person described in 19
266	266	section 465(b)(3)(A) with respect to such organiza-20
267	267	tion or any employee of such organization. 21
268	268	‘‘(4) P
269	269	ROHIBITION ON SELF-DEALING.— 22
270	270	‘‘(A) I
271	271	N GENERAL.—A scholarship grant-23
272	272	ing organization may not award a scholarship 24
273	273	to any disqualified person. 25
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277	277	‘‘(B) DISQUALIFIED PERSON .—For pur-1
278	278	poses of this paragraph, a disqualified person 2
279	279	shall be determined pursuant to rules similar to 3
280	280	the rules of section 4946. 4
281	281	‘‘(e) D
282	282	ENIAL OFDOUBLEBENEFIT.—Any qualified 5
283	283	contribution for which a credit is allowed under this sec-6
284	284	tion shall not be taken into account as a charitable con-7
285	285	tribution for purposes of section 170. 8
286	286	‘‘(f) C
287	287	ARRYFORWARD OF UNUSEDCREDIT.— 9
288	288	‘‘(1) I
289	289	N GENERAL.—If the credit allowable 10
290	290	under subsection (a) for any taxable year exceeds 11
291	291	the limitation imposed by section 26(a) for such tax-12
292	292	able year reduced by the sum of the credits allowable 13
293	293	under this subpart (other than this section, section 14
294	294	23, and section 25D), such excess shall be carried to 15
295	295	the succeeding taxable year and added to the credit 16
296	296	allowable under subsection (a) for such taxable year. 17
297	297	‘‘(2) L
298	298	IMITATION.—No credit may be carried 18
299	299	forward under this subsection to any taxable year 19
300	300	following the fifth taxable year after the taxable year 20
301	301	in which the credit arose. For purposes of the pre-21
302	302	ceding sentence, credits shall be treated as used on 22
303	303	a first-in first-out basis.’’. 23
304	304	(2) C
305	305	ONFORMING AMENDMENTS .— 24
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308	308	•HR 833 IH
309	309	(A) Section 25(e)(1)(C) of such Code is 1
310	310	amended by striking ‘‘and 25D’’ and inserting 2
311	311	‘‘25D, and 25F’’. 3
312	312	(B) The table of sections for subpart A of 4
313	313	part IV of subchapter A of chapter 1 of such 5
314	314	Code is amended by inserting after the item re-6
315	315	lating to section 25E the following new item: 7
316	316	‘‘Sec. 25F. Qualified elementary and secondary education scholarships.’’.
317	317	(b) CREDIT FORCORPORATIONS.— 8
318	318	(1) I
319	319	N GENERAL.—Subpart D of part IV of 9
320	320	subchapter A of chapter 1 of the Internal Revenue 10
321	321	Code of 1986 is amended by adding after section 11
322	322	45AA the following: 12
323	323	‘‘SEC. 45BB. CONTRIBUTIONS TO SCHOLARSHIP GRANTING 13
324	324	ORGANIZATIONS. 14
325	325	‘‘(a) G
326	326	ENERALRULE.—For purposes of section 38, 15
327	327	in the case of a corporation, the education scholarship 16
328	328	credit determined under this section for the taxable year 17
329	329	is the aggregate amount of qualified contributions for the 18
330	330	taxable year. 19
331	331	‘‘(b) A
332	332	MOUNT OFCREDIT.—The credit allowed under 20
333	333	subsection (a) for any taxable year shall not exceed 5 per-21
334	334	cent of the taxable income (as defined in section 22
335	335	170(b)(2)(D)) of the corporation for such taxable year. 23
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339	339	‘‘(c) QUALIFIEDCONTRIBUTIONS.—For purposes of 1
340	340	this section, the term ‘qualified contribution’ has the 2
341	341	meaning given such term under section 25F. 3
342	342	‘‘(d) D
343	343	ENIAL OFDOUBLEBENEFIT.—No deduction 4
344	344	shall be allowed under any provision of this chapter for 5
345	345	any expense for which a credit is allowed under this sec-6
346	346	tion. 7
347	347	‘‘(e) A
348	348	PPLICATION OF VOLUMECAP.—A qualified 8
349	349	contribution shall be taken into account under this section 9
350	350	only if such contribution is not in excess of the volume 10
351	351	cap established under section 3 of the Educational Choice 11
352	352	for Children Act of 2025.’’. 12
353	353	(2) C
354	354	ONFORMING AMENDMENTS .—Section 13
355	355	38(b) of such Code is amended by striking ‘‘plus’’ at 14
356	356	the end of paragraph (40), by striking the period 15
357	357	and inserting ‘‘, plus’’ at the end of paragraph (41), 16
358	358	and by adding at the end the following new para-17
359	359	graph: 18
360	360	‘‘(42) the education scholarship credit deter-19
361	361	mined under section 45BB(a).’’. 20
362	362	(3) C
363	363	LERICAL AMENDMENT .—The table of sec-21
364	364	tions for subpart D of part IV of subchapter A of 22
365	365	chapter 1 of such Code is amended by adding at the 23
366	366	end the following new item: 24
367	367	‘‘Sec. 45BB. Contributions to scholarship granting organizations.’’.
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371	371	(c) FAILURE OFSCHOLARSHIPGRANTINGORGANI-1
372	372	ZATIONSTOMAKEDISTRIBUTIONS.— 2
373	373	(1) I
374	374	N GENERAL.—Chapter 42 of such Code is 3
375	375	amended by adding at the end the following new 4
376	376	subchapter: 5
377	377	‘‘Subchapter I—Scholarship Granting 6
378	378	Organizations 7
379	379	‘‘Sec. 4969. Failure to distribute receipts.
380	380	‘‘SEC. 4969. FAILURE TO DISTRIBUTE RECEIPTS.
381	381	8
382	382	‘‘(a) I
383	383	NGENERAL.—In the case of any scholarship 9
384	384	granting organization (as defined in section 25F) which 10
385	385	has been determined by the Secretary to have failed to 11
386	386	satisfy the requirement under subsection (b) for any tax-12
387	387	able year, any contribution made to such organization dur-13
388	388	ing the first taxable year beginning after the date of such 14
389	389	determination shall not be treated as a qualified contribu-15
390	390	tion (as defined in section 25F(c)(2)) for purposes of sec-16
391	391	tions 25F and 45BB. 17
392	392	‘‘(b) R
393	393	EQUIREMENT.—The requirement described in 18
394	394	this subsection is that the amount of receipts of the schol-19
395	395	arship granting organization for the taxable year which 20
396	396	are distributed before the distribution deadline with re-21
397	397	spect to such receipts shall not be less than the required 22
398	398	distribution amount with respect to such taxable year. 23
399	399	‘‘(c) D
400	400	EFINITIONS.—For purposes of this section— 24
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404	404	‘‘(1) REQUIRED DISTRIBUTION AMOUNT .— 1
405	405	‘‘(A) I
406	406	N GENERAL.—The required distribu-2
407	407	tion amount with respect to a taxable year is 3
408	408	the amount equal to 100 percent of the total re-4
409	409	ceipts of the scholarship granting organization 5
410	410	for such taxable year— 6
411	411	‘‘(i) reduced by the sum of such re-7
412	412	ceipts that are retained for reasonable ad-8
413	413	ministrative expenses for the taxable year 9
414	414	or are carried to the succeeding taxable 10
415	415	year under subparagraph (C), and 11
416	416	‘‘(ii) increased by the amount of the 12
417	417	carryover under subparagraph (C) from 13
418	418	the preceding taxable year. 14
419	419	‘‘(B) S
420	420	AFE HARBOR FOR REASONABLE AD -15
421	421	MINISTRATIVE EXPENSES .—For purposes of 16
422	422	subparagraph (A)(i), if the percentage of total 17
423	423	receipts of a scholarship granting organization 18
424	424	for a taxable year which are used for adminis-19
425	425	trative purposes is equal to or less than 10 per-20
426	426	cent, such expenses shall be deemed to be rea-21
427	427	sonable for purposes of such subparagraph. 22
428	428	‘‘(C) C
429	429	ARRYOVER.—With respect to the 23
430	430	amount of the total receipts of a scholarship 24
431	431	granting organization with respect to any tax-25
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435	435	able year, an amount not greater than 15 per-1
436	436	cent of such amount may, at the election of 2
437	437	such organization, be carried to the succeeding 3
438	438	taxable year. 4
439	439	‘‘(2) D
440	440	ISTRIBUTIONS.—The term ‘distribution’ 5
441	441	includes amounts which are formally committed but 6
442	442	not distributed. A formal commitment described in 7
443	443	the preceding sentence may include contributions set 8
444	444	aside for eligible students for more than one year. 9
445	445	‘‘(3) D
446	446	ISTRIBUTION DEADLINE .—The distribu-10
447	447	tion deadline with respect to receipts for a taxable 11
448	448	year is the first day of the third taxable year fol-12
449	449	lowing the taxable year in which such receipts are 13
450	450	received by the scholarship granting organization.’’. 14
451	451	(2) C
452	452	LERICAL AMENDMENT .—The table of sub-15
453	453	chapters for chapter 42 of such Code is amended by 16
454	454	adding at the end the following new item: 17
455	455	‘‘SUBCHAPTER I. SCHOLARSHIP GRANTING ORGANIZATIONS ’’.
456	456	(d) EFFECTIVEDATE.—The amendments made by 18
457	457	this section shall apply to taxable years ending after De-19
458	458	cember 31, 2025. 20
459	459	SEC. 3. VOLUME CAP. 21
460	460	(a) I
461	461	NGENERAL.—For purposes of sections 22
462	462	25F(b)(2) and 45BB(e) of the Internal Revenue Code of 23
463	463	1986 (as added by this Act), the volume cap applicable 24
464	464	under this section shall be $10,000,000,000 for calendar 25
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467	467	•HR 833 IH
468	468	year 2026 and each subsequent year thereafter. Such 1
469	469	amount shall be allocated by the Secretary as provided in 2
470	470	subsection (b) to taxpayers with respect to qualified con-3
471	471	tributions made by such taxpayers, except that 10 percent 4
472	472	of such amount shall be divided evenly among the States, 5
473	473	and shall be available with respect to— 6
474	474	(1) individuals residing in such States to claim 7
475	475	the credit allowed under section 25F of the Internal 8
476	476	Revenue Code of 1986, and 9
477	477	(2) corporations created or organized in such 10
478	478	State to claim the credit determined under section 11
479	479	45BB of such Code. 12
480	480	(b) F
481	481	IRST-COME, FIRST-SERVE.—For purposes of 13
482	482	applying the volume cap under this section, such volume 14
483	483	cap for any calendar year shall be allocated by the Sec-15
484	484	retary on a first-come, first-serve basis, as determined 16
485	485	based on the time (during such calendar year) at which 17
486	486	the taxpayer made the qualified contribution with respect 18
487	487	to which the allocation is made. The Secretary shall not 19
488	488	make any allocation of volume cap for any calendar year 20
489	489	after December 31 of such calendar year. 21
490	490	(c) R
491	491	EAL-TIMEINFORMATION.—For purposes of this 22
492	492	section, the Secretary shall develop a system to track the 23
493	493	amount of qualified contributions made during the cal-24
494	494	endar year for which a credit may be claimed under sec-25
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497	497	•HR 833 IH
498	498	tion 25F or 45BB of the Internal Revenue Code of 1986, 1
499	499	with such information to be updated in real time. 2
500	500	(d) A
501	501	NNUALINCREASES.— 3
502	502	(1) I
503	503	N GENERAL.—In the case of the calendar 4
504	504	year after a high use calendar year, the dollar 5
505	505	amount otherwise in effect under subsection (a) for 6
506	506	such calendar year shall be equal to 105 percent of 7
507	507	the dollar amount in effect for such high use cal-8
508	508	endar year. 9
509	509	(2) H
510	510	IGH USE CALENDAR YEAR .—For purposes 10
511	511	of this subsection, the term ‘‘high use calendar 11
512	512	year’’ means any calendar year for which 90 percent 12
513	513	or more of the volume cap in effect for such cal-13
514	514	endar year under subsection (a) is allocated to tax-14
515	515	payers. 15
516	516	(3) P
517	517	REVENTION OF DECREASES IN ANNUAL 16
518	518	VOLUME CAP.—The volume cap in effect under sub-17
519	519	section (a) for any calendar year shall not be less 18
520	520	than the volume cap in effect under such subsection 19
521	521	for the preceding calendar year. 20
522	522	(4) P
523	523	UBLICATION OF ANNUAL VOLUME CAP .— 21
524	524	The Secretary shall make publicly available the dol-22
525	525	lar amount of the volume cap in effect under sub-23
526	526	section (a) for each calendar year. 24
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529	529	•HR 833 IH
530	530	(e) STATES.—For purposes of this section, the term 1
531	531	‘‘State’’ includes the District of Columbia. 2
532	532	SEC. 4. EXEMPTION FROM GROSS INCOME FOR SCHOLAR-3
533	533	SHIPS FOR QUALIFIED ELEMENTARY OR SEC-4
534	534	ONDARY EDUCATION EXPENSES OF ELIGIBLE 5
535	535	STUDENTS. 6
536	536	(a) I
537	537	NGENERAL.—Part III of subchapter B of chap-7
538	538	ter 1 of the Internal Revenue Code of 1986 is amended 8
539	539	by inserting before section 140 the following new section: 9
540	540	‘‘SEC. 139J. SCHOLARSHIPS FOR QUALIFIED ELEMENTARY 10
541	541	OR SECONDARY EDUCATION EXPENSES OF 11
542	542	ELIGIBLE STUDENTS. 12
543	543	‘‘(a) I
544	544	NGENERAL.—In the case of an individual, 13
545	545	gross income shall not include any amounts provided to 14
546	546	any dependent of such individual pursuant to a scholar-15
547	547	ship for qualified elementary or secondary education ex-16
548	548	penses of an eligible student which is provided by a schol-17
549	549	arship granting organization. 18
550	550	‘‘(b) D
551	551	EFINITIONS.—In this section, the terms ‘quali-19
552	552	fied elementary or secondary education expense’, ‘eligible 20
553	553	student’, and ‘scholarship granting organization’ have the 21
554	554	same meaning given such terms under section 25F(c).’’. 22
555	555	(b) C
556	556	ONFORMINGAMENDMENT.—The table of sec-23
557	557	tions for part III of subchapter B of chapter 1 of the In-24
558	558	ternal Revenue Code of 1986 is amended by inserting be-25
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561	561	•HR 833 IH
562	562	fore the item relating to section 140 the following new 1
563	563	item: 2
564	564	‘‘Sec. 139J. Scholarships for qualified elementary or secondary education ex-
565	565	penses of eligible students.’’.
566	566	(c) EFFECTIVEDATE.—The amendments made by 3
567	567	this section shall apply to amounts received after Decem-4
568	568	ber 31, 2025, in taxable years ending after such date. 5
569	569	SEC. 5. ORGANIZATIONAL AND PARENTAL AUTONOMY. 6
570	570	(a) P
571	571	ROHIBITION OFCONTROLOVERSCHOLARSHIP 7
572	572	O
573	573	RGANIZATIONS.— 8
574	574	(1) I
575	575	N GENERAL.— 9
576	576	(A) T
577	577	REATMENT.—A scholarship granting 10
578	578	organization shall not, by virtue of participation 11
579	579	under any provision of this Act or any amend-12
580	580	ment made by this Act, be regarded as acting 13
581	581	on behalf of any governmental entity. 14
582	582	(B) N
583	583	O GOVERNMENTAL CONTROL .—Noth-15
584	584	ing in this Act, or any amendment made by this 16
585	585	Act, shall be construed to permit, allow, encour-17
586	586	age, or authorize any Federal, State, or local 18
587	587	government entity, or officer or employee there-19
588	588	of, to mandate, direct, or control any aspect of 20
589	589	any scholarship granting organization. 21
590	590	(C) M
591	591	AXIMUM FREEDOM .—To the extent 22
592	592	permissible by law, this Act, and any amend-23
593	593	ment made by this Act, shall be construed to 24
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596	596	•HR 833 IH
597	597	allow scholarship granting organizations max-1
598	598	imum freedom to provide for the needs of the 2
599	599	participants without governmental control. 3
600	600	(2) P
601	601	ROHIBITION OF CONTROL OVER NON -PUB-4
602	602	LIC SCHOOLS.— 5
603	603	(A) N
604	604	O GOVERNMENTAL CONTROL .—Noth-6
605	605	ing in this Act, or any amendment made by this 7
606	606	Act, shall be construed to permit, allow, encour-8
607	607	age, or authorize any Federal, State, or local 9
608	608	government entity, or officer or employee there-10
609	609	of, to mandate, direct, or control any aspect of 11
610	610	any private or religious elementary or secondary 12
611	611	education institution. 13
612	612	(B) N
613	613	O EXCLUSION OF PRIVATE OR RELI -14
614	614	GIOUS SCHOOLS.—No Federal, State, or local 15
615	615	government entity, or officer or employee there-16
616	616	of, shall impose or permit the imposition of any 17
617	617	conditions or requirements that would exclude 18
618	618	or operate to exclude educational expenses at 19
619	619	private or religious elementary and secondary 20
620	620	education institutions from being considered 21
621	621	qualified elementary or secondary education ex-22
622	622	penses. 23
623	623	(C) N
624	624	O EXCLUSION OF QUALIFIED EX -24
625	625	PENSES DUE TO INSTITUTION ’S RELIGIOUS 25
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629	629	CHARACTER OR AFFILIATION .—No Federal, 1
630	630	State, or local government entity, or officer or 2
631	631	employee thereof, shall exclude, discriminate 3
632	632	against, or otherwise disadvantage any elemen-4
633	633	tary or secondary education institution with re-5
634	634	spect to qualified elementary or secondary edu-6
635	635	cation expenses at that institution based in 7
636	636	whole or in part on the institution’s religious 8
637	637	character or affiliation, including religiously 9
638	638	based or mission-based policies or practices. 10
639	639	(3) P
640	640	ARENTAL RIGHTS TO USE SCHOLAR -11
641	641	SHIPS.—No Federal, State, or local government en-12
642	642	tity, or officer or employee thereof, shall disfavor or 13
643	643	discourage the use of scholarships granted by par-14
644	644	ticipating scholarship granting organizations for 15
645	645	qualified elementary or secondary education ex-16
646	646	penses at private or nonprofit elementary and sec-17
647	647	ondary education institutions, including faith-based 18
648	648	schools. 19
649	649	(4) P
650	650	ARENTAL RIGHT TO INTERVENE .—In any 20
651	651	action filed in any State or Federal court which 21
652	652	challenges the constitutionality (under the constitu-22
653	653	tion of such State or the Constitution of the United 23
654	654	States) of any provision of this Act (or any amend-24
655	655	ment made by this Act), any parent of an eligible 25
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658	658	•HR 833 IH
659	659	student who has received a scholarship from a schol-1
660	660	arship granting organization shall have the right to 2
661	661	intervene in support of the constitutionality of such 3
662	662	provision or amendment. To avoid duplication of ef-4
663	663	forts and reduce the burdens placed on the parties 5
664	664	to the action, the court in any such action may re-6
665	665	quire interveners taking similar positions to file joint 7
666	666	papers or to be represented by a single attorney at 8
667	667	oral argument, provided that the court does not re-9
668	668	quire such interveners to join any brief filed on be-10
669	669	half of any State which is a defendant in such ac-11
670	670	tion. 12
671	671	(b) D
672	672	EFINITIONS.—For purposes of this section, the 13
673	673	terms ‘‘eligible student’’, ‘‘scholarship granting organiza-14
674	674	tion’’, and ‘‘qualified elementary or secondary education 15
675	675	expense’’ shall have the same meanings given such terms 16
676	676	under section 25F(c) of the Internal Revenue Code of 17
677	677	1986 (as added by section 2(a) of this Act). 18
678	678	Æ
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