Pennsylvania Education Funding Programs: EITC and OSTC Scholarships Explained for Parents

Quick answer: Pennsylvania does not have an education savings account or a state-funded voucher. Its two parent-facing programs are business-funded tax-credit scholarships. Under the Educational Improvement Tax Credit (EITC), businesses donate to approved Scholarship Organizations, which award private school scholarships to students whose household income is no more than $122,322 plus $21,531 for each dependent. The Opportunity Scholarship Tax Credit (OSTC) uses the same income limit but is only for students who live within the attendance boundary of a low-achieving public school; for 2025-26 the OSTC maximum was $8,500, or $15,000 for a special education student. Parents apply to a scholarship organization, not to the state.

Pennsylvania families hear a lot about school choice debates in Harrisburg, and it is easy to come away thinking the state has a voucher or ESA. It does not. What it has, and has had for more than two decades, is a pair of tax credit programs that route business donations into scholarships.

This guide covers who qualifies, how much a scholarship can be worth, how to apply and how these programs fit with homeschooling. To compare Pennsylvania with other states, see our state education funding programs guide for parents.

Sources: Pennsylvania Department of Community and Economic Development (DCED), Educational Improvement Tax Credit Program page and Opportunity Scholarship Tax Credit Program page; Pennsylvania Department of Education (PDE), Opportunity Scholarship Tax Credit Program page and Home Education Program guidance; Public School Code section 1327.1 (home education); IRS, Federal Scholarship Tax Credit participating states list (updated October 22, 2026). Figures can change each fiscal year. This is general information, not legal or tax advice. Last verified October 2026.

How Pennsylvania's Programs Work

Both programs follow the same basic chain:

1. A business authorized to do business in Pennsylvania applies to DCED for tax credits.
2. Once approved, the business donates to an approved organization.
3. The organization awards scholarships to eligible students.
4. The business receives a state tax credit for part of its donation.

Parents only deal with step 3. You never apply to DCED or PDE for a scholarship; you apply to one or more scholarship organizations. That is the main difference from ESA states like Arizona or Florida, where the state or its administrator runs the application. Our explainer on the difference between ESAs, vouchers and tax-credit scholarships goes deeper on why this matters.

On the business side, DCED says credits equal 75 percent of a contribution, rising to 90 percent if the business commits to giving the same amount for two consecutive years, with a cap of $750,000 per taxable year. Applications are processed first come, first served by the day submitted until credits run out. That structure is why scholarship organizations raise different amounts each year, and why award sizes vary from one organization to another.

EITC Scholarships

What they are

The Educational Improvement Tax Credit program funds three kinds of organizations:

• Scholarship Organizations (SOs), which award scholarships to students for private K-12 schools;
• Educational Improvement Organizations (EIOs), which fund innovative programs in public schools; and
• Pre-Kindergarten Scholarship Organizations (PKSOs), which award scholarships for eligible pre-K programs.

For parents of school-age children, the Scholarship Organization side is the part that pays toward private school tuition.

Who qualifies

DCED states that students are eligible for an EITC scholarship if their household’s annual income is no greater than $122,322 plus $21,531 for each dependent member of the household. There is no requirement to live near a particular school, which makes EITC the broader of the two programs.

Here is how that formula plays out for a few household sizes. Treat these as illustrations of the published formula, and confirm how your scholarship organization counts dependents.

Dependents in the household	Income limit using DCED’s formula
1	$143,853
2	$165,384
3	$186,915
4	$208,446

How much a scholarship pays

DCED does not set one statewide EITC scholarship amount. Each Scholarship Organization decides award sizes within the law, based on what it raised and how many families applied. Many organizations serve a particular school, diocese, region or group of schools, so the amount you receive depends heavily on which organization you apply to.

OSTC Scholarships

What they are

The Opportunity Scholarship Tax Credit is a narrower program aimed at students zoned for struggling public schools. DCED explains that Opportunity Scholarship Organizations use business donations to give “tuition assistance in the form of scholarships to eligible students residing within the boundaries of a low-achieving school to attend another public school outside of their district or nonpublic school.”

The low-achieving school rule

A low-achieving school is a public elementary or secondary school ranked in the bottom 15 percent of its designation based on combined math and reading scores on the Pennsylvania System of School Assessment (PSSA). PDE publishes the list each year, and the OSTC page for 2026-27 links to the current list. Your eligibility depends on where you live, not on where your child currently attends. If you are within the attendance boundary of a listed school, your child may qualify even if they already attend a private school.

Income limit and award maximums

OSTC uses the same household income limit as EITC: $122,322 plus $21,531 per dependent. DCED states that for the 2025-26 school year, the maximum OSTC scholarship is $8,500 for a non-special education student and $15,000 for a special education student. Check the DCED or PDE page for the 2026-27 figures before you budget, since maximums can be updated.

How OSTC and EITC compare

Feature	EITC scholarship	OSTC scholarship
Funded by	Business donations with state tax credits	Business donations with state tax credits
Income limit	$122,322 + $21,531 per dependent	$122,322 + $21,531 per dependent
Where you must live	Anywhere in Pennsylvania	Within the boundary of a low-achieving public school on PDE’s list
Can be used for	Private K-12 tuition (through Scholarship Organizations)	Private school tuition or another public school outside your district
Award size	Set by each organization	Set by each organization, up to $8,500 or $15,000 (special education) for 2025-26
Where to apply	An approved Scholarship Organization	An approved Opportunity Scholarship Organization

How to Apply Step by Step

1. Choose the schools you are considering. Many Pennsylvania private schools work with specific scholarship organizations. Ask each school’s admissions or tuition office which organizations its families use.
2. Check your address against PDE’s low-achieving school list. If your home falls within the boundary of a listed school, you can also apply for OSTC.
3. Find approved organizations. DCED publishes lists of approved Scholarship Organizations and Opportunity Scholarship Organizations, and the OSTC parent FAQ links to them.
4. Gather income documents. Organizations verify household income against the state limit, so have tax returns or other proof ready.
5. Apply early and to more than one organization if allowed. Because donations are limited, organizations often award funds until they run out.
6. Ask about renewals. Some organizations give priority to returning recipients; ask how renewals work so you can plan for future years.

For a broader checklist of documents and timing used across states, see our guide on how to apply for state education funding.

Questions to Ask a Scholarship Organization

Because each organization runs its own process, a short list of questions saves time and helps you compare offers:

• Which schools do your scholarships cover, and can the award move with my child if we change schools?
• Do you award EITC funds, OSTC funds or both?
• What documents do you need to verify household income, and which tax year do you use?
• When does your application open, and do you award on a rolling basis or all at once?
• Is the award paid directly to the school, and is it applied to tuition only or also to fees?
• Do returning students have to reapply each year, and is there a priority for renewals or siblings?
• If my income changes during the year, do I need to report it?

Write down the answers for each organization. Families who apply to more than one organization often find that the rules on renewals and school eligibility matter as much as the dollar amount.

Planning for the Full Cost of Private School

A scholarship rarely covers everything. Tuition is usually the largest cost, but schools may also charge registration, technology, activity or book fees, and families often pay for uniforms, transportation and lunches. Before you commit, ask each school for a written list of required fees and find out which of them the scholarship can be applied to. Ask too whether the school offers its own need-based aid that can be combined with an EITC or OSTC award, and in what order the school applies the different sources.

Pennsylvania and Homeschooling

Pennsylvania has one of the more detailed home education laws in the country. Under section 1327.1 of the Public School Code and PDE’s guidance, a parent running a home education program must:

• file a notarized affidavit (or an unsworn declaration) with the school district superintendent before starting, and by August 1 each following year;
• provide the minimum instruction time, which is 180 days, or 900 hours at the elementary level and 990 hours at the secondary level;
• keep a portfolio with a log of reading materials, samples of the student’s work and, in grades 3, 5 and 8, results of standardized tests in reading and math (PSSA or an approved nationally normed test); and
• have the portfolio reviewed each year by a qualified evaluator, who interviews the student and certifies whether an appropriate education is occurring. School districts commonly ask that the evaluator’s certification be submitted by June 30.

On funding, homeschoolers in Pennsylvania have limited options. EITC and OSTC scholarships pay toward tuition at schools, so a homeschooled student does not use them while learning at home. Families who want public support for home-based learning sometimes look at Pennsylvania’s cyber charter schools, which are public schools that provide curriculum at no tuition, but a child enrolled in a cyber charter is a public school student, not a homeschooler, and follows the school’s rules rather than the home education law.

Our guide on whether homeschoolers can use state education funds explains how this differs from states like Florida and Arizona.

What About the Federal Scholarship Tax Credit?

Starting January 1, 2027, the IRS says individuals may claim a Federal Scholarship Tax Credit of up to $1,700 for certain cash contributions to Scholarship Granting Organizations in states that elect to participate. As of the IRS list updated October 22, 2026, Pennsylvania was not on the list of participating states. Because states can make or change this election, check the IRS participating states page if you want to know whether the federal credit will support scholarships in Pennsylvania.

Mistakes to Avoid

• Applying to the state. DCED and PDE do not award scholarships to families. Apply to the organizations.
• Missing the address test. OSTC eligibility depends on your home address and the current year’s low-achieving school list, which can change.
• Assuming a set amount. Except for the OSTC maximums, award amounts are set by each organization and depend on donations.
• Waiting until summer. Organizations commonly award funds as they have them, so late applicants may find money already committed.
• Confusing cyber charter with homeschool. They follow different rules and funding.

Frequently Asked Questions

Does Pennsylvania have school vouchers or an ESA?

No. As of October 2026, Pennsylvania’s parent-facing programs are the EITC and OSTC tax-credit scholarships, which are funded by business donations and awarded by approved organizations.

What is the income limit for Pennsylvania EITC scholarships?

DCED lists the limit as household annual income no greater than $122,322 plus $21,531 for each dependent member of the household. OSTC uses the same limit.

How much is an Opportunity Scholarship in Pennsylvania?

For 2025-26, DCED lists a maximum of $8,500 for a non-special education student and $15,000 for a special education student. Each organization decides actual award amounts.

How do I know if my child qualifies for OSTC?

Your home must be within the attendance boundary of a school on PDE’s current low-achieving school list, and your household income must be within the state limit.

Can homeschoolers in Pennsylvania get state education funding?

Not through EITC or OSTC, which pay toward school tuition. Homeschoolers follow the home education law in section 1327.1 and generally pay their own costs.

The Bottom Line

Pennsylvania’s education funding for parents runs through scholarship organizations, not the state. If your household income fits the EITC formula, ask your target schools which organizations they work with and apply early. If you live near a school on PDE’s low-achieving list, add OSTC to your search. Homeschooling families should focus on meeting the home education law, since the scholarship programs are built around school tuition.