Illinois - Tax Credits for Educational Expenses

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Illinois – Tax Credits for Educational Expenses

Illinois – Tax Credits for Educational Expenses

Illinois’ Tax Credits for Educational Expenses program was enacted in 1999 and launched in 2000 to help families afford the public, private or home school options that fit their children’s needs. Learn more about the program’s details on this page, including eligibility, funding, regulations, legal history and more.

Program Fast Facts

  • One of five state tax credit programs for educational expenses nationwide

  • 297,492 participating taxpayers (2016)

  • 100 percent of taxpaying families with children eligible statewide

  • Average tax credit value: $257 (2016)

  • Value as a percentage of public school per-student spending: 2 percent

Program Details

Illinois’s Tax Credits for Educational Expenses Participation

Tax Returns Claiming Credit
Tax Year

Click the + symbols to learn more about this program’s details.

Illinois allows individuals to claim a credit for educational expenses for dependent students attending a private or public school or being homeschooled. Qualified expenses include tuition, books and lab or activity fees. The credit is worth a maximum of $500.

Tax Credit Value

Parents receive a tax credit worth 25 percent of their expenditures after the first $250, up to a maximum credit of $750 per family. To get the maximum $750 credit, parents must spend $3,250 on educational expenses; they also must have a state tax liability of at least $750 because the credit is nonrefundable and thus cannot reduce an individual’s tax burden to less than zero.

Student Eligibility

Educational expenses must be for students who are residents of Illinois, who are younger than 21 and attend kindergarten through 12th grade in a public, private or home school in Illinois. Qualified expenses include tuition, books and lab or activity fees. Beginning in 2018, the state imposed an income limit for the tax credit. Married families with a federal Adjusted Gross Income (AGI) exceeding $500,000, as well as non-married families with an AGI of $250,000, are no longer eligible for the credit.

EdChoice Expert Feedback

The Illinois individual tax credit program deserves credit for being accessible to most students statewide and avoiding any unnecessary regulations on private schools. Unfortunately, participants have very little funding power because the tax credits are capped at just $750 and cover only 25 percent of education expenses. Illinois could improve this program dramatically by raising the tax credit to at least the state’s average per-pupil expenditures in public schools, increasing the tax credit value to 100 percent of educational expenditures and providing a refundable credit (similar to Alabama’s) so that lower-income families can participate.

Rules and Regulations

  • Income Limit: $500,000 (married); $250,000 (single)
  • Prior Year Public School Requirement: None
  • Geographic Limit: Statewide
  • Enrollment Cap: None
  • Individual Credit Cap: $750
  • Testing Mandates: None


Parent Requirements:

  • Parents must ensure students are residents of Illinois, under the age of 21 at the close of the school year and were full-time pupils in grades K–12 in any qualifying public or nonpublic elementary or secondary school

Governing Statutes

35 ILCS5/.201(m)

Legal History

In 1999, the Illinois Federation of Teachers, Illinois Education Association, and the People for the American Way brought two lawsuits in state court arguing the program violated the First Amendment of the U.S. Constitution and religion clauses of the Illinois Constitution. Illinois appellate courts upheld the programs and the Illinois Supreme Court refused to grant appeals. Toney v. Bower, 744 N.E.2d 351 (Ill. App. 4th Dist. 2001), appeal denied, 195 N.E.2d 573 (Ill. 2001); Griffith v. Bower, 747 N.E.2d 423 (Ill. App. 5th Dist. 2001), appeal denied, 755 N.E.2d 477 (Ill. 2001).

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