Abstract
The One Big Beautiful Bill Act (“OB3”) introduced Scholarship Granting Organizations (“SGOs”) into federal tax law through new Internal Revenue Code § 25F, which creates a federal income tax credit for qualifying contributions to state-certified scholarship organizations beginning in 2027. Because SGOs have long existed at the state level as part of broader school choice initiatives, Code Section 25F delegates to participating states, including the responsibility to certify eligible organizations and establish oversight procedures. West Virginia’s decision to participate in the federal SGO framework, coupled with its recent adoption of the Hope Scholarship Program, places the state at the center of an emerging debate regarding educational funding, school choice, and tax policy.
This Article examines the structure and operation of the new federal SGO credit and situates it within the broader history of state-level scholarship tax credit programs. After analyzing the statutory framework of new Code § 25F, Article surveys existing SGO-style programs in Arizona, Pennsylvania, and Ohio. These state models illustrate varying approaches to certification, oversight, income limitations, reporting obligations, and coordination with existing educational initiatives.
Drawing from those examples, the Article evaluates how West Virginia might design its own SGO certification and oversight regime in a manner consistent with both federal requirements and the state’s educational priorities. Ultimately, the Article argues that careful legislative drafting and administrative oversight will be essential if West Virginia seeks to implement an effective, transparent, and fiscally responsible SGO program under the new federal framework.
Recommended Citation
Elaine Waterhouse Wilson, How Should West Virginia Approach Scholarship Granting Organizations, 128 W. Va. L. Rev. Online 1 (2026).