Tax Credits for Educational Expenses
- Individual Tax Credit/Deduction
- Enacted 1999
- Launched 2000
Illinois allows individuals to claim a credit for educational expenses for dependent students attending a public, private or home school. Learn more about the program’s details on this page, including eligibility, funding, regulations, legal history and more.
We do not administer this program.
Participating Taxpayers (2018)
Percent of Taxpaying Families with K-12 Children Eligible Statewide
Average Tax Credit Value (2018)
Value as a Percentage of Public School Per-student Spending
Illinois’s Tax Credits for Educational Expenses Participation
Parents receive a tax credit worth 25 percent of their K–12 expenditures after the first $250 spent, 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.
Educational expenses must be used 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
- Credit Value: 25%
- Taxpayer Credit Cap: $750
- Testing Mandates: None
- 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
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).