Politics 5 min read By Alice Ashford
Hochul opts New York into Trump school choice tax credit
New York Governor Kathy Hochul has signed the state up to the federal Education Freedom Tax Credit, breaking with Democratic legislative leaders and making New York the 31st state to join the programme.
New York has become the 31st state to join the Trump administration's Education Freedom Tax Credit, after Governor Kathy Hochul opted in despite opposition from the Democratic leaders of both chambers of the state legislature. The decision makes New York the second Democratic-led state to participate, following Colorado Governor Jared Polis.
Hochul said she had been clear that New York would take part only if all schools and students, including those in public schools, could benefit. «I'm not going to leave money on the table when it could help our kids,» she said in her announcement on 9 October. The move came days after Assembly Speaker Carl Heastie and Senate Majority Leader Andrea Stewart-Cousins urged her to stay out.
Heastie, a Bronx Democrat, said New York should opt out of the federal voucher programme and continue investing in the public schools that educate the overwhelming majority of children. Stewart-Cousins, a Yonkers Democrat, warned that the federal rules would undercut New York's ability to set meaningful guardrails, leaving the state with little control over which schools and expenses qualify or how the funding is used.
The tax credit was created by the One Big Beautiful Bill Act, the sweeping tax-and-spending law President Trump signed in July 2025. From 1 January 2027, taxpayers can claim a dollar-for-dollar federal credit of up to $1,700 for cash donations to approved scholarship-granting organisations. Under proposed regulations released on 1 October, married couples filing jointly are treated as separate taxpayers and can claim up to $3,400 combined. Because the credit reduces federal tax revenue, it does not draw on state budgets. Governors must opt in each year for students in their state to receive scholarships, though taxpayers anywhere can donate to scholarship organisations in participating states.
Students in New York are eligible if their household income is no more than 300 per cent of their area's median gross income. That works out at roughly $309,000 in the Bronx and $510,000 in Westchester County, according to estimates cited by the Manhattan Institute's City Journal, which projects that more than 2.7 million New York students could qualify. Scholarships can cover private and religious school tuition, while public school students can use them for expenses such as tutoring, special education services, books and technology. The Scholarships for All New Yorkers coalition cites a projection from Education Reform Now that the programme could generate $1.5 billion a year for New York students if a third of eligible taxpayers take part.
The decision has drawn criticism from the state's largest teachers' union, New York State United Teachers, which called it «President Trump's private-school voucher program» and had pressed Hochul for weeks to reject it. The union argues that income limits topping $500,000 in parts of the state make the credit more a tax break for the wealthy than an education programme. «The governor says this won't take a dollar from public schools, but it takes federal tax money, which belongs to all of us, and hands it to private schools with no rules about who they must admit or how they account for it,» said Beatriz Beckford of MomsRising.
Supporters, including Catholic and Orthodox Jewish school advocates and Democrats for Education Reform, praised the move. The American Legislative Exchange Council, a conservative group of state legislators and private-sector members, described it as part of a growing bipartisan movement and urged the remaining states to follow. Nationally, the Treasury projects that by 2030 more than 11 million taxpayers could donate nearly $26 billion a year through the programme, while the Joint Committee on Taxation estimates a revenue cost of $25.9 billion over a full decade.
The Treasury and the Internal Revenue Service are accepting public comments on the proposed rules until 1 December, with a public hearing scheduled for 15 December. The remaining states have until 1 January 2027 to decide whether to join. The move also lands weeks before Election Day, as Hochul faces Republican nominee Bruce Blakeman, who has criticised her for not opting in sooner.
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