How It Works
A scholarship granting organization (SGO) provides Education Freedom Tax Credit (EFTC) scholarships to qualifying children. EFTC scholarships were enacted in 2027 and feature a 100% Federal Tax Credit for contributions made to our SGO, up to $1,700 per taxpayer. Donors can designate the school that should receive the money for scholarships.
On July 4, President Trump signed “The One Big Beautiful Bill.” One aspect of this bill includes a Education Freedom Tax Credit (EFTC) program that is modeled after successful state tax credit scholarship programs throughout our country, including Indiana. This program is a part of a modified version of the Educational Choice for Children Act (ECCA.)
Federal Scholarship Tax Credit (EFTC) Program Key Points
- The bill allows for a 100% Federal Tax Credit for donations from individuals to Scholarship Granting Organizations, just like our Lutheran SGO.
- There is a $1,700 maximum Federal Tax Credit per taxpayer per year.
- Donors can designate their gift to be used for scholarships at the school of their choice.
- Donations can come from individuals in any state, but SGOs can only provide scholarships in their state. Businesses are not allowed to claim this credit.
- There is no sunset date on this legislation. It is permanent.
- There is no aggregate tax cap. The $1,700 maximum Federal Tax Credit is available to every taxpayer in our country.
- There is a five-year rollover on this tax credit.
- Scholarship recipients must come from families earning under 300% of the Median Local Income.
Gov. Braun has officially opted-in to allow schools in Indiana to participate in the program, and our Lutheran SGO has been recognized as an approved SGO to manage the EFTC!
The EFTC program begins on January 1, 2027.
While a $1,700 maximum Federal Tax Credit is not nearly as significant as the State Tax Credit allowed in Indiana, the fact that the $1,700 is a 100% Federal Tax Credit provides a great incentive to donate. If Hoosiers continue to contribute to our Lutheran SGO taking advantage of the 50% State Tax Credit, and then also contribute taking advantage of the 100% Federal Tax Credit, we can truly maximize our financial support for our Family of Schools. Imagine the impact that this will have on our students attending our schools!
Pick a participating school.
Begin by selecting a school to receive your scholarship gift. Here’s a list.
Donate directly through our state-approved program.
Your charitable contribution is submitted to us. We make sure your gift provides scholarships for students at your selected school.
Receive your gift receipt and 100% federal tax credit.
Once your donation is confirmed, we’ll provide the paperwork you’ll need to claim your 100% federal tax credit.
File your taxes and benefit fully.
When you file your state tax return, report the donation on Schedule 6 and Form IN-OCC.
Other Giving Assistance
How to Claim Your Tax Credit
(Provided by DWD CPA & Advisors. Please discuss this with your own financial and tax advisors.)
Lutheran SGO Brochure
Making the Dream of a Christian Education a Reality for Families through Scholarships.
Gifts Eligible for Donation to the
Lutheran SGO
The Lutheran Federal Scholarship Granting Organization of Indiana is a 501(c)3 non-profit corporation and accepts various gifts that can be eligible for charitable donations. Donations can include the following:
- Cash/Checks
- Credit/debit
- Wire Transfer
- ACH/EFT Payment
FAQ
For answers, discussions, and clarifications to many common Federal SGO-related donation questions, please download our FAQ. Should you have additional questions not addressed in this sheet, feel free to contact us at 260-203-4509, or email us at info@lutheransgo.org.