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26 U.S.C. §139K: Scholarships aren't taxable income
Scholarships from a scholarship granting organization aren't counted as income for the student or the family.
- Citation
- Public Law 119-21, title VII, §70411(b)
- Issued or enacted
- July 4, 2025
- Takes effect
- January 1, 2027
- Status
- Published
The official text
As published on uscode.house.gov, copied September 28, 2026. The official copy is the one that counts.
(a) In general
In the case of an individual, gross income shall not include any amounts provided to such individual or any dependent of such individual pursuant to a scholarship for qualified elementary or secondary education expenses of an eligible student which is provided by a scholarship granting organization.
(b) Definitions
In this section, the terms "qualified elementary or secondary education expense", "eligible student", and "scholarship granting organization" have the same meaning given such terms under section 25F(c).
- Source credit
- (Added Pub. L. 119–21, title VII, §70411(b)(1), July 4, 2025, 139 Stat. 217 .)
- Effective date
- Section applicable to amounts received after Dec. 31, 2026, in taxable years ending after such date, see section 70411(c)(2) of Pub. L. 119–21, set out in an Effective Date of 2025 Amendment note under section 25 of this title.
On this site
Where we use it
The pages whose rules and figures come from §139K.
Federal law
Related documents
- §25F26 U.S.C. §25F: Qualified elementary and secondary education scholarshipsThe federal credit itself. It sets the $1,700 limit, what counts as a qualifying donation, and the rules a scholarship granting organization has to follow.
- §530(b)(3)26 U.S.C. §530(b)(3): Qualified K-12 education expensesThe list of K-12 expenses a scholarship can pay for. The credit borrows it from the rules for Coverdell education savings accounts.
- P.L. 119-21Public Law 119-21, §70411(c): When the credit takes effectThe effective dates. The credit applies to tax years ending after December 31, 2026, so the first donations that count are made on or after January 1, 2027.