Private school voucher programs aggravate public school funding shortfalls while failing to improve academic outcomes. President Trump’s “Big, Beautiful Bill” will establish the first national school voucher program, providing tax credit scholarships for families to use at private schools.
On Dec. 23, PEER Illinois submitted a Public Comment to the IRS strongly opposing implementation of the national school voucher program.
Private school voucher programs divert essential public resources from public school systems, many of which already face severe underfunding. Diverting public funds to vouchers leaves public schools with even fewer resources to meet the needs of their students. Public schools need more, not fewer, resources to educate all students, particularly their most vulnerable.
Click here to read the Public Comment, or see the full text below:
Dear IRS Commissioner Bessent,
The Partnership for Equity and Education Rights Illinois (PEER Illinois) is a statewide advocacy network dedicated to driving increased investment in our children. We bring together school community members, organizers, academics, researchers, lawyers and policymakers to drive reinvestment in public education. We focus on campaigns that ensure all students have access to the resources they need for success. Through a combination of organizing, research, advocacy, and legal work, we strive to advance a community-led platform that illustrates what fully funded education should looks like in Illinois.
As community members with lived experience in our public schools, experts in the field of education research, law, and policy, and advocates for public school students we offer comments in strong opposition to the federal private school voucher program included in Public Law No. 119-21 (July 4, 2024) and proposed regulations.
Whether they are structured as traditional vouchers, education savings accounts, or tax credits, private school choice programs divert essential public resources from public school systems, exacerbate existing deficits and inequities without meaningfully improving academic outcomes. Short of advancing their purported goal of advancing educational opportunity, private school voucher programs aggravate public school funding shortfalls and drain resources available to public schools, which serve the vast majority of students, and ensure these schools provide a high quality, equitable, and non-discriminatory education that is open to all children.
Private school voucher programs divert public funds from public schools while failing to improve academic outcomes.
Private school vouchers do not benefit students, families, or communities, nor do they help the most vulnerable, highest-need students obtain a better education than they can receive in public schools. Experts in the field of school law, policy and evidence have set forth credible evidence that vouchers cause great harm, in multiple ways, to those they claim to benefit.
Students who use vouchers experience worse educational outcomes than their public school peers, in private schools that are subject to few, if any, quality and accountability standards. Vouchers perpetuate racial and economic segregation, and the majority of vouchers are used by wealthier families who already send their children to private schools. Moreover, voucher students lose most of their legal protections under special education and civil rights laws, and voucher programs use public dollars to fund private schools that can and do discriminate against students and employees in ways that are not lawful in public schools.
Many school districts across the country already face severe underfunding. Diverting public funds to vouchers leaves public schools with even fewer resources to meet the needs of their students, who represent ninety percent of children across the country. At the same time, high-need students, who are frequently rejected by private schools, are concentrated in public schools, which must welcome and serve all students. State voucher programs threaten the very existence of neighborhood public schools. When neighborhood schools close, students and their communities face devastating effects in the realms of education as well as social and civic engagement. Public schools need more, not fewer, resources in order to educate all students, particularly their most vulnerable.
The federal voucher program, by design, diverts federal tax dollars that should be used for public education and other much-needed public services. The program does not include meaningful quality or accountability standards nor anti-discrimination requirements and will provide vouchers to wealthy families, even those that have already chosen and are paying for private education. Because the program includes no spending cap, the federal government can expect significant revenue loss to unaccountable scholarship granting organizations (“SGOs”) and private schools, while increasing the national debt. Indeed, in states with voucher programs, voucher costs almost inevitably increase over time, public school funding declines, and the burden on taxpayers and state budgets rises.
For all these reasons, we remain firmly opposed to the expansion of private school vouchers at the state or federal levels.
While we maintain that the federal voucher program is a deeply harmful policy that should be repealed, we respectfully submit the following comments regarding Notice 2025-70 and forthcoming regulatory guidance under Internal Revenue Code § 25F.
1. Definition of “Located in a State.” We recommend a definition requiring SGOs to (a) maintain a physical presence within the electing State; (b) operate state-specific, segregated accounts; (c) maintain state-specific governance structures; and (d) document state-specific scholarship operations. These standards are necessary to ensure enforceability and prevent the aggregation or reallocation of contributions across State lines.
2. State Certification and Oversight. We recommend requiring States to conduct documented, substantive reviews before certifying SGOs. SGOs should be subject to periodic audits, mandatory reporting requirements, and immediate removal upon noncompliance. Such measures are essential for program integrity and administrability. Further, as the program was structured to allow maximum respect for state level decision-making in the opt-in/opt-out process, States should similarly be entrusted to oversee and impose additional duties on SGOs as they see fit. This extends to an affirmation within federal regulations that states may ask SGOs to direct some or all of their spending to support students who attend public schools.
3. Coordination with State Tax Benefits and Charitable Deduction Rules. We support firm prohibitions on duplicative tax benefits. Contributions used to claim §25F credits should not qualify for charitable deductions or overlapping state credits. Clear standards will guard against tax arbitrage and maintain fiscal balance.
In addition, we are compelled to comment on the need for strong data collection and reporting requirements, so that the government and the public are aware of how taxpayer dollars are being used and the impact this program will have on public schools, public school students, and students who use vouchers to attend private schools. Accordingly, we join the additional concerns and recommendations submitted by The Education Law Center and Public Funds for Public School regarding Section 4.05 requesting comments on reporting and record keeping requirements.
Respectfully submitted,
Maddy Wheelock
Coalition Coordinator
PEER Illinois
peer@ilraiseyourhand.org | 1325 S Wabash Ave Suite 105, Chicago, IL 60605