Homeschool Funding in Virginia

State Funding and Financial Resources

Virginia has emerged as one of the most financially supportive states for homeschool families, with a new state tax credit and early adoption of the federal Education Freedom Tax Credit.

Alternative Schooling Tax Credit (SB1085)

Enacted for tax years 2025 through 2029, Virginia's Alternative Schooling Tax Credit is a refundable income tax credit for parents of home education or private school students:

• Base credit: Up to $5,000 per eligible student per year for qualifying expenses (instructional materials, home instruction courses, or private school tuition)
• Enhanced credit: Families with Virginia adjusted gross income at or below 300% of the federal poverty guidelines may claim an additional $2,500, for a total of up to $7,500 per student
• Limited to one credit per eligible student per year
• Total aggregate credit cap of $25 million annually, allocated on a first-come basis

This is a significant benefit. A refundable credit means you receive the money even if you owe no state income tax.

Federal Education Freedom Tax Credit

In December 2025, Virginia became the first state to formally opt in to the federal Education Freedom Tax Credit. Beginning January 1, 2027, taxpayers can contribute to approved Scholarship Granting Organizations (SGOs) and receive a federal tax credit of up to $1,700. SGOs will distribute scholarships to K-12 students, including homeschoolers, for expenses like tutoring, technology, curriculum, and transportation.

Federal 529 Plan Expansion (2026)

Starting in 2026, families can withdraw up to $20,000 per student per year tax-free from 529 accounts for K-12 expenses, including homeschool curriculum, test fees, tutoring, and educational therapies. Verify Virginia's conformity with expanded federal definitions before claiming state tax benefits.

Virginia529 (Invest529)

Virginia's own 529 plan, Invest529, offers state tax deductions for contributions. Combined with the expanded federal withdrawal limits, this can be a powerful savings tool for homeschool families planning ahead.