Idaho families receiving notice of Parental Choice Tax Credit awards

This week brought welcome news for many Idaho parents who applied for the inaugural Parental Choice Tax Credit program, which began accepting applications on January 15. The Tax Commission has started notifying applicants by email and Taxpayer Access Point (TAP) portal messaging regarding credit awards.

The $50 million school choice program will provide eligible Idaho families with qualified private education expenses, like private school tuition, home school curriculum, and testing fees, a credit ($5,000 or up to $7,500 for special needs children), thereby allowing families to focus on providing the best education for their students.

Depending on income, families had the option to apply for either a traditional tax credit, to receive reimbursement for qualified expenses already paid, or an advance payment to help cover costs upfront. Priority was given to families with a 2024 modified adjusted gross income at or below 300% of the federal poverty level, providing access to more families interested in exploring education options outside of the public school system.

When the application portal opened, the State Tax Commission, the agency responsible for processing applications, saw an overwhelming response from parents, with 3,300 applications submitted in the first few hours, causing the portal to temporarily crash. During the two-month application window, the agency processed 6,069 applications representing 13,568 students; a clear indication that families across the state are seeking greater flexibility and control over their children’s education.

If you applied for the parental choice tax credit, verify if you have received a notice confirming the award. The amount you may include on line 42 of your Idaho Form 40 tax return will be specified in that notice and is based on the receipts you submitted documenting your expenses.

Regardless of when you receive your notification, the deadline to file 2025 tax returns is April 15, 2026, and all applicants must file on time or request an extension to maintain program eligibility.  If you have already filed your taxes, you will need to submit an amended return to include the credit.

Families receiving the advance payment must also file their 2025 taxes on time, although they won’t reconcile the tax credit until 2026.  For these families, it is essential to continue saving receipts for any qualifying expenses incurred from January 1, 2026, through the end of this year.  These receipts will be submitted to the Tax Commission next tax season to verify that funds were used for qualified educational purposes. Any money spent on non-qualifying expenses or expenses without proper documentation must be repaid during the reconciliation process.

As with any public program, accountability remains important. Maintain accurate, organized records throughout the year in case you are subject to an audit. 

It’s an exciting time for families, as tax credit award notifications are now being sent. Applicants should regularly check their email and TAP account for updates.