Redirecting taxes under ECCA works as a federal tax credit. It applies directly to a portion of the federal income taxes you already owe.
A charitable donation is a voluntary gift to a nonprofit organization. Donations may qualify as a tax deduction, which reduces your taxable income — not your taxes dollar for dollar.
When funds are redirected through ECCA, they flow to approved nonprofit Scholarship Granting Organizations (SGOs) like Well Planned Education. By law, SGOs must distribute at least 90% of received funds as student scholarships. These funds are governed by nonprofit compliance standards and federal program guidelines — not discretionary government spending.
In short, a donation is a gift that may reduce income for tax purposes. A tax credit under ECCA directly reduces taxes owed and is structured specifically to support student scholarships.
