TAXATION – Amends, repeals, and adds to existing law to repeal and replace the Idaho Parental Choice Tax Credit and the Idaho Parental Choice Tax Credit Advance Payment Fund.
House Bill 590 repeals and replaces Idaho’s existing Parental Choice Tax Credit and the related advance payment fund. The bill creates a new refundable income tax credit for parents of eligible K-12 students who incur qualified education expenses for nonpublic schooling, tutoring, testing, curricula, and transportation. Beginning with tax year 2028, the credit would generally be up to $5,000 per eligible student, with a higher cap of $7,500 for eligible students with disabilities who require ancillary personnel. The bill also allows a one-time advance payment option for qualifying families, subject to application and income-based priority rules.
The measure defines eligible students, parents, nonpublic schools, and qualified expenses in detail, and it bars use of the credit for students enrolled in public schools during the relevant semester. It requires applications, sworn certifications, annual surveys, recordkeeping, and reporting by the State Tax Commission and Legislative Services Office. The bill also sets a statewide annual cap of $50 million in total credits, establishes a waiting list if demand exceeds the cap, and provides that the credit is refundable and excluded from Idaho taxable income.
The bill would substantially revise Idaho Code sections governing the parental choice tax credit and the advance payment fund, replacing the current statutory framework with a new version effective in stages in 2027 and 2028. It would create a new refundable tax credit program administered by the State Tax Commission, add reporting and survey obligations, and continue a dedicated advance payment fund for prepaying credits to eligible families. The bill affects taxpayers claiming education-related expenses, nonpublic schools that receive tuition paid through the credit, and state agencies responsible for administration, oversight, and reporting.
Based on the bill text and the absence of recorded committee testimony or votes in the provided materials, the measure appears to be framed as a school-choice and family-support proposal rather than a contested compromise. Its structure suggests support for expanding educational options for families, especially lower-income households and students with disabilities, while also imposing administrative controls and a statewide funding cap. No formal vote history or transcript evidence is provided here to indicate broader legislative sentiment, but the bill’s detailed eligibility, priority, and reporting provisions suggest an effort to make the program more targeted and accountable.
The main points of potential contention are the use of state tax revenue to subsidize private and alternative education, the exclusion of students enrolled in public schools, and the $50 million annual cap that could limit access once demand exceeds available credits. Another likely issue is the income-priority structure, which favors families at or below 300% of the federal poverty level and gives returning recipients priority in later years, potentially raising questions about equity and access. The bill also includes oversight and survey requirements, which may be viewed as accountability measures by supporters but as administrative burdens by opponents, and it expressly limits state regulation of nonpublic schools, which may be important to school-choice advocates.