Ever since my trip to the Partners in Mission conference, I get some version of the same question almost every week now:
Which scholarship organization should our school work with?
Right now, I don't think anyone can give a complete answer, but that is okay!
As it currently stands, we know quite a bit about what a Scholarship Granting Organization will have to do under the new federal tax credit. Beyond that, the Treasury has already started to preview some of the rules it expects to release this fall, with over thirty states making advance elections to participate for 2027.
However, what we don’t have are the regulations themselves or the state-approved SGO lists that will tell donors and schools which organizations will actually implement the federal scholarship tax credit.
That distinction matters.
Don't pick the organization yet. Prepare your questions instead.
The temptation right now is to focus on back to school, wait for the Treasury, and the ultimate publication of an official list. Personally, and as this series of articles should indicate, I think waiting for that is a BIG mistake.
Given that the Treasury doesn’t anticipate releasing guidance until September, schools will only have a few relatively short months to figure out who will be the best partner to actually serve their families well. That is a useful timeline for implementing a partnership, but not the time to start thinking about what matters in a SGO-partner.
So, I encourage all of you to write the questions down now. The first one I would ask is surprisingly simple:
When will your scholarship application open relative to our admissions calendar?
A scholarship award is most impactful when a family is making the decision where their child will attend school. If your admissions decisions happen in March and your scholarship partner doesn’t issue award notifications until June or July, you may have a problem even if everything else about the organization looks good. Then I would keep going.
How will money actually move?
When does a school receive scholarship funds? What reporting will be required? What happens if money raised cannot immediately be awarded?
How are you planning to satisfy the 90% requirement?
Federal law requires an SGO to spend at least 90% of its income on scholarships.
During sessions with Secretary Bessent in early June, education leaders were given a preview of how the Treasury expects that calculation to work. These included a possible safe harbor tied to the organization's segregated federal scholarship account, among other items to help speed up program implementation. So, while the proposed regulations are still coming, a prospective partner should already be able to explain what Treasury has said and offer some details on how they are preparing.
Then I would ask about governance and compliance.
Who makes scholarship decisions? How are conflicts handled? Who owns compliance? How are you preparing for the audit and conflict-of-interest requirements? What happens when a mistake is discovered?
Finally, ask who has expertise.
This may end up being one of the easiest ways to distinguish organizations.
Some prospective FSTC SGOs have worked with tax credits, and/or administered scholarship programs for years. Others are newcomers, and are being built specifically for 2027.
There is nothing wrong with being new, and in many ways, the newness of this program, and those supporting it is something to be excited about! But, by the time January rolls around, everyone will have a polished website, and it will be harder to tell the difference between an organization that has spent a year developing expertise and one that has spent a month building user interfaces and marketing collateral.
So I would ask:
What have you already built?
Application systems. Income verification. School agreements. Payment processes. Compliance controls. Family support. Data security.
Don’t just look for promises.
Use August and September to look for expertise, and for reliable infrastructure. You do not need to know who your SGO will be yet. You need to know what you will ask when the names are published, and SGOs are reaching out.
If you want to pressure-test the numbers for your own school while you prepare, FundEDU's free 20-minute Scholarship Revenue Review is designed for just that!