Every kid has unique needs and talents. Starting from that basic premise, education should meet every kid where they are. Unfortunately, too many families lack access to their best-fit option today, but a simple and familiar idea can help ensure every family finds the education that works for them.
And families are excited about it.
In just the first two-and-a-half days of the open application period for Oklahoma’s universal, refundable tax credit – the first program like it in the nation – the state received applications for nearly 30,000 kids. These came from about 18,000 families looking to select the best education that suits their child’s unique passions and interests.
As a policy, tax credits are not a new idea. The federal Child Tax Credit, for instance, is broadly popular across the nation, and about one-third of families use it on education expenses today. Oklahoma’s experience further shows us that families are ready and able to craft their kids’ educational journey.
Sooner families can now count between $5,000 and $7,500 for private school tuition, or up to $1,000 for homeschooling costs, directly against their taxes for the year. Because the credit is refundable, all participating families, even those with a lower tax bill, receive a full benefit. This is a historic moment for education freedom and one that should be built upon.
During the open public comment period, yes. every kid. foundation. offered guidance for the Tax Commission, the regulatory body overseeing the program in Oklahoma. Among the suggestions was keeping private school accreditation “as broad as the law intends” and eliminating superfluous reporting required of private schools. The commission heeded that advice, as well as other suggestions to prioritize families’ needs, rather than bureaucratic control.
Even though the program expands freedom overall, the rules do not permit taxpayers to claim the credit on their income tax return when utilizing the private school option. Instead, the private school option is being administered solely as a government payment with the tax credit amount being sent to the private school via a check in the name of the taxpayer, akin to a voucher. States which follow Oklahoma in this endeavor should empower families to seek out their ideal educational solution, not merely those which the state approves.
A new report from yes. every kid. serves as a how-to guide for lawmakers looking to construct the ideal educational tax credit program that trusts families and supports their unique educational choices.
Personal education tax credits, in their ideal, are different than other forms of education freedom, like vouchers, specifically, because they reduce the need for new bureaucracy to be administered. Vouchers — along with their more flexible cousins, education savings accounts (ESAs) — empower families with education funds but often deliver them through a new state program. Each of these policies increase freedom and can coexist with one another in a suite of direct-funding options for families.
Since tax credit programs often rely on existing funding streams, they are likely to save taxpayer funds overall. This is the case in Arizona and for every other direct-to-family funding mechanism for education in America: the cost of a family’s education expenses reimbursed by the credit will likely be less than what a state spends on a student in public school per year. For example, the average direct-to-family funding amount for a child in Arizona is $7,500, half of the statewide per-pupil funding average of about $15,000.
An ideal education policy removes the middleman and affirms that parents hold the ultimate decision-making power. Why should a tax credit for education be any different than a tax credit for home weatherization, lightbulbs, or electric cars? With education tax credits, states can save time and resources while serving the direct needs of families.
Lawmakers looking to enact a strong educational tax credit should ensure that the policy is universal and refundable (like Oklahoma’s), is easy to apply for, and funds families as close as possible to the state average spending amount.
State policymakers can lead with this idea. Propose a simple and universal program that trusts families to secure the best for their children with direct funding. This is the promise of education tax credits: The more we empower families to customize the educational experience they desire, the quicker we’ll find out what works best for each kid.