One of the most-asked questions about the federal scholarship tax credit was whether a married couple filing jointly shares a single $1,700 limit. The proposed regulations answer it: each spouse counts as a separate taxpayer.
How it works
If each spouse makes their own qualified donation of up to $1,700, the couple can claim up to $3,400 on their joint return. Each spouse's credit is based on that spouse's own donation.
Example: Sarah gives $1,700 and David gives $1,700 to a Scholarship Granting Organization in 2027. On their joint 2027 return, they can claim up to $3,400 in federal credits, if they owe at least that much federal tax.
Practical tips
- Make two gifts, one in each spouse's name, so each has its own acknowledgement.
- Give from personal funds, not through a business or donor-advised fund.
- Keep the acknowledgement letters you receive by January 31.
The rules are still proposed and could change. Ask your tax advisor how this applies to you.
General information, not tax advice. Based on the law and proposed regulations, which may change.