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ILLINOIS POLICY INSTITUTE

CONTACT: Melanie Krakauer (312) 607-4977

Tax credit scholarship bill moves to Gov. Pritzker’s desk
Illinois Policy Institute experts point to progress, but are still concerned for the program’s future after 2023

CHICAGO (April 8, 2022) — The Illinois General Assembly yesterday completed passage of a bill which amends Illinois’ Invest in Kids Tax Credit Scholarship program to protect already-enrolled students. The bill now moves to Gov. J.B. Pritzker’s desk for signature.

The Illinois House passed Senate Amendment 1 to House Bill 4126, sponsored by state Rep. Curtis Tarver, D-Chicago, granting super-priority status to current scholarship recipients. It would provide assurance to students that they can continue in their current schools by ensuring if they receive a scholarship one year, they will also receive it the next year.

Still, Illinois Policy Institute experts point out the program is currently set to expire Dec. 31. 2023, potentially leaving thousands of families’ futures uncertain.

“These scholarships can be life changing for low-income families, providing students an education that fits their unique needs and strengthening communities in the process. This bill takes an important step toward providing needed educational stability for families,” said Amy Korte, executive vice president for the Illinois Policy Institute. “The next step is ensuring the program will last for the long term for students in need.”

About the Invest in Kids program: The Invest in Kids program was passed by lawmakers in 2017 and allows individuals and businesses to donate money to a scholarship-granting organization and receive a tax credit of 75 cents for every $1 donated. It offers low-income families scholarship money to attend qualified non-public schools that best suit their needs. Approximately 7,600 K-12 Illinois students received an Invest in Kids scholarship and about 26,000 were on the waitlist last year.

Scholarships are awarded to K-12 students whose family income does not exceed 300% of the federal poverty level. In 2020, the average annual household income of participants who received scholarship money through Empower Illinois, the largest scholarship granting organization in the state, was just over $38,000. Nearly half of the children receiving scholarships are students of color.

Illinois Policy Institute recommendations for additional reforms:

• Preserve and strengthen Illinois’ tax credit scholarship program by eliminating the 2023 sunset provision or extending the sunset by at least 10 years.
• Allow businesses to designate particular schools as the recipients of their donations, as individual donors can do under current law.
• Expand the program to include pre-K students, in addition to the kids in K-12 who are currently eligible.
• Allow donors to deduct for federal income tax purposes or take a credit against their state income taxes the 25% of their gift that is not currently federally deductible or creditable against state taxes.

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