CEN was created to put a Christian education within reach for every family who wants one. CEN SGO is how it works, and the engine behind it is a new federal law. You will see it called by several names. This article explains what the law is, what it does, and why now is the time to pay attention, even though no one gives a dollar through it until 2027.
One program, several names
The same program goes by a few different names depending on who is writing about it.
- Educational Choice for Children Act, or ECCA, the name of the original bill
- Education Freedom Tax Credit, the name the Department of Education and Treasury use
- The federal scholarship tax credit, the name the IRS uses
They all point to the same thing. It was enacted as part of the 2025 tax law, Public Law 119-21. When you see any of these names, you are reading about the same credit. EdChoice covers the passage of the law and confirms it as the first federal tax credit of its kind for education scholarships.
What the law actually does
The law creates a federal income tax credit for donors who give to a qualified scholarship granting organization, an SGO, in a participating state. CEN SGO is one of those organizations, built specifically for Evangelical and Catholic schools.
Here is how a donor uses it. You redirect part of what you already owe in federal income tax to the SGO. In return, you receive a dollar-for-dollar credit against your federal tax, up to an annual per-taxpayer limit set in the law. The credit reduces your tax itself, which is what separates a credit from a deduction. A deduction only reduces the income you are taxed on.
A few rules shape how it works:
- The credit is non-refundable. It reduces the tax you owe but does not pay out beyond your liability.
- Unused credit carries forward up to five years.
- You cannot also claim a charitable deduction for the same gift.
- The federal credit is reduced by any state credit you claim on the same dollars.
- A donor may designate a participating school, but not a specific student.
The Brownstein Q&A guide walks through these mechanics in full. For the law itself, the Congressional Research Service report gives a neutral summary of the federal scholarship tax credit as enacted.
Who the scholarships reach
The SGO spends at least 90 percent of every gift on scholarships. A student qualifies at up to 300 percent of the Area Median Gross Income for their area, which reaches most working and middle-income families, well beyond the lowest earners. The model is built on the proven track record of the Ohio scholarship network, which has been awarding scholarships under a state credit for years.
Why it matters now, before 2027
The program is not live yet. Donors will be able to give starting January 1, 2027, for the 2027 tax year. No one claims this credit on a 2025 or 2026 return.
So why act now? Two reasons.
For schools, the work happens before the giving window opens. A school that registers with CEN now will be listed and ready before donors start giving, with a co-branded profile and a marketing toolkit in place. Donors give to schools they can find. Registration is what makes a school findable.
For donors and families, now is the time to learn how it works and to sign up to be notified. The states have begun opting in. The IRS confirmed in June 2026 that more than half the states had signed up to participate. When tax year 2027 arrives, the donors and schools who prepared this year will be ready to move on day one.
Frequently asked questions
Is ECCA the same as the Education Freedom Tax Credit?
Yes. Educational Choice for Children Act, Education Freedom Tax Credit, and the federal scholarship tax credit are three names for the same program, enacted in Public Law 119-21 in 2025.
Can I claim this credit on my next tax return?
No. The credit is effective for tax year 2027. Giving begins January 1, 2027. There is nothing to claim on a 2025 or 2026 return.
What is the difference between this and a charitable deduction?
A deduction lowers your taxable income. This credit lowers the tax you owe, dollar for dollar. You cannot claim both for the same gift, so the credit is the stronger benefit for most donors.
Where to go from here
For the full mechanics of how an SGO gift works, read What is an SGO, and how does the federal tax credit work?. Schools that want to be listed before the window opens should start at Registering your school with CEN: what it involves and what you get.
When you are ready, Register your school to be listed before we go to donors, or Get notified to be reached the moment giving opens for 2027.
