Enacted 2006 • Launched 2006 • Tax-Credit Scholarship
Iowa provides a credit on individual income taxes for donations to School Tuition Organizations
(STOs), nonprofits that provide private school scholarships. The credit is worth 65 percent of
the donation’s value, which also is limited by a statewide cap. A maximum of $8.75 million in
tax credits is available. Each STO is able to grant tax credits to its donors up to its share of the
statewide limit, with each STO’s share determined by the enrollment at the schools it serves.
Corporate donations are able to constitute up to 25 percent of the $8.75 million cap.
Latest Stats (2011-12)
- Students participating: 10,600
- Schools participating: 154
- Scholarship organizations: 12
- Average scholarship value: $1,031
Average scholarship value as a percentage of
Iowa’s total per-student spending ($9,748)
Each STO determines the amount of the scholarships it distributes.
Children are eligible to receive scholarships if their family income does not exceed 300 percent
of federal poverty guidelines ($69,150 for a family of four in 2013). Current private school
students also are eligible.
No legal challenges have been filed against the program.
Rules & Regulations
- Income Limit: 300% x Poverty
- Geographic Limit: Statewide
- Enrollment Cap: None
- Scholarship Cap: Full Tuition
- Testing Mandates: None
- Credit Value: 65%
- Credit Cap: None
- Program Cap: $8.75 million
Section 422.11S of the Iowa Code
Michael Chartier | firstname.lastname@example.org
The cap was expanded by section 95 of the 2011 appropriations bill, Senate File 533, available at: http://coolice.legis.state.ia.us/linc/84/external/govbills/SF533.pdf.