With the upcoming school year about to begin, this is a good time to share about a new opportunity that could significantly reduce tuition costs for many Catholic school families in New Jersey for years to come – and to ask for you to help make this possibility a reality.
In July 2025, the U.S. Congress passed the Federal Educational Tax Credit as part of the Federal Budget Reconciliation Bill. The FETC expands opportunities for scholarships that parents can use to send their children to the school of their choice, including a Catholic school.
For families like yours, scholarships funded through the FETC can help to relieve the financial costs of the choice you already make to send your children to a Catholic school.
The program works by offering a federal tax credit to donors and a scholarship to families:
• Families with a household income up to 300% of the local median income qualify for scholarship support.
• A scholarship-granting organization works with schools to use donations from individuals to provide scholarships of varying amounts to students from eligible families for tuition and qualified educational expenses.
• Individual donors receive a 100% federal tax credit on a contribution of up to $1,700 to the scholarship-granting organization. The donation can be made as a one-time donation or in installments. The tax credit creates an incentive for more individuals to donate, so that more scholarship funds are available.
• The donor receives a dollar-for-dollar tax credit on his or her federal taxes, and scholarship recipients have lower out-of-pocket expenses for choosing a tuition-based school – in our case, a Catholic school.
Because this is a federal tax credit, no New Jersey tax dollars are involved, so funding for students attending public schools remains unchanged. In fact, donors could direct a portion of their federal tax dollars to any school – Catholic, private or public – to fund scholarships or other educational expenses. Tax-credit supported contributions would increase overall funding for children in New Jersey and support the right of parents to choose the best environment for their children.
Although this is a federal program, the governor of each state must opt in to allow donors to receive the federal tax credit incentive for contributing to scholarship-granting organizations that support students in that state. Thirty-one states have opted in so far, but New Jersey is not yet one of them. If New Jersey declines to participate, donors here will still be eligible for the federal tax credit, but they would have to contribute to scholarship-granting organizations in other states. In other words, funds that could support scholarships for students here in New Jersey would instead leave the state. It is in the best interest of all students in New Jersey for those funds to stay in the state to support their education.
The staff in the Diocese of Camden’s Office of Catholic Schools is tracking this program closely, in collaboration with the New Jersey Catholic Conference (the public policy arm of the state’s Catholic bishops], the Council for American Private Education, and Catholic education colleagues within and beyond New Jersey. We have interviewed the leadership of scholarship-granting organizations to lay the groundwork for accepting donations and offering scholarships.
We are also working with the board of the South Jersey Scholarship Fund on donor outreach strategies to maximize scholarship dollars available to students in South Jersey Catholic Schools.
We anticipate that scholarships would be available for the 2027-2028 school year, but only if the state opts in prior to Jan. 1, 2027.
I am asking you to join us in working toward this scholarship opportunity in three ways:
1) Learn more about contribution and scholarship opportunities, and register to receive updates and action alerts at NJScholarshipCredit.org.
2) Share this opportunity and the website with Catholic school families, those who are considering Catholic school, potential scholarship donors, and anyone else interested in bringing more funds to education in New Jersey and supporting families’ right to choose the school that best fits the needs of their family and children.
3) Pray that the right of families to choose their children’s school will prevail and that New Jersey will opt in so that more families can benefit from this opportunity.
Thank you for your continued partnership and your commitment to Catholic schools. The financial commitment to a Catholic school is always significant – for a family, a parish, the Diocese, parishioners and donors. Families like yours know that it is worth it.
More than 60% of states have recognized the excellence of Catholic schools – and the importance of the right of parents to choose them – by opting in to the ECCA. By working together, we can help make it possible for all children in South Jersey to have the opportunity to experience the benefits of a Catholic school education that aligns with their unique needs, potential and family values.
Dr. William A. Watson is the superintendent of schools for the Diocese of Camden.
What You Can Do
Interest in this important opportunity is growing, and your involvement matters. At this stage, the most helpful steps are to learn about the program, share these educational resources with others and sign up for updates.
Please wait to contact the N.J. Governor’s Office until the New Jersey Catholic Conference issues an official Action Alert. Coordinated outreach at the right time will help ensure that our voices have the greatest possible impact. Sign up today to be notified of news and action alerts.
Visit NJScholarshipCredit.org.
at the bottom and then tap “Add to Home Screen”
