One, Big, Beautiful Bill provisions – Tax-exempt entities and charitable giving
Indian tribal governments and the Adoption Credit (Section 70403)
Overview of the change
The Act recognizes Indian tribal governments for purposes of determining whether a child has special needs for the adoption tax credit
Provides parity with state governments, by giving tribal governments the same ability to determine whether a child has special needs for purposes of the adoption tax credit
Related resources
Tax information for Indian tribal governments
Tax credit for donations to scholarship organizations (Section 70411)
Overview of the credit
Beginning Jan. 1, 2027, individual taxpayers may be able to claim a federal tax credit for certain donations they make
The credit applies to cash contributions to Scholarship Granting Organizations (SGOs)
An SGO is a nonprofit that awards scholarships to help students pay for elementary and secondary education
The tax credit is nonrefundable, which means it can reduce your federal tax bill but will not result in a refund if the credit is larger than what you owe
The maximum credit an individual can claim each year is $1,700
Important details
A state or the District of Columbia must choose to participate in the program before the credit can be claimed for contributions to SGOs within that state
States must provide the IRS with a list of qualifying SGOs that meet legal requirements
Related resources
States can make an Advance Election to participate in the new federal tax credit for individual contributions to SGOs (IR-2025-121)
