WHAT ARE SCHOLARSHIP GRANTING ORGANIZATIONS AND WHY DO THEY MATTER?
The Federal Scholarship Tax Credit Program becomes effective in January 2027 and will offer dollar-for-dollar Education Freedom Tax Credits to all American taxpayers who donate up to $1,700 to approved Scholarship Granting Organizations (SGOs). This means that for every dollar donated to an SGO, the donor will pay one less dollar in federal income taxes. Tax credits are MUCH more valuable than charitable tax deductions because of this dollar-for-dollar benefit.
In turn, the SGOs will provide Education Freedom Scholarships to eligible k-12 students which can be used for tuition, transportation, school supplies, and other educational expenses.
The projections for the amounts to be donated to SGOs are in the billions of dollars. But with great opportunity comes a critical challenge: quality control. The law includes minimal federal oversight, leaving donors and families with little guidance on which SGOs operate with integrity, transparency, and impact. Without safeguards, the risk of waste, fraud, and abuse could undermine the promise of this initiative.
AAA Scholarship Foundation (“AAA”) has been a highly respected and successful SGO since 2010. Donors, parents, and regulators have trusted AAA with hundreds of millions of dollars for educational scholarships that provide real positive social and economic benefits. Our mission has always been to ensure every dollar donated delivers meaningful educational opportunity. AAA’s new SGO Navigator initiative represents a natural evolution of that commitment: building infrastructure that protects families and strengthens the integrity of educational choice nationwide.
WHAT CONSTITUTES A HIGH QUALITY SGO?
As you begin to navigate the world of SGOs, we encourage you to work with experienced SGOs that promote quality choices, are aligned with your values, and are proven to be accountable. To assist you with your due diligence, below is a list of fiscal responsibility and governance questions to ask each SGO you’re considering:
• Does the SGO have clean (“unqualified”) audits/reviews for the past three years?
• Does the SGO have demonstrated success raising scholarship funds?
• What is their staff experience in successfully running non-profit organizations?
• What is their experience successfully rolling out and implementing new scholarship programs?
• How many scholarships did they award for the prior school year and what was the total dollar amount awarded?
• Do they have an outside party endorsement for good practices (i.e. Charity Navigator or Guide Star/Candid)?
• What are outside stakeholders (parents/schools/donors) saying about their experience with the SGO?
• Does the SGO outsource their technology and / or customer service to third parties?
• What types and levels of insurance policies does the SGO have in place?
AAA TAX CREDITS
Below is more information about AAA Scholarship Foundation. AAA tax credits are dollar-for-dollar tax reductions received by taxpayers from federal and state governments to incentivize investment in k-12 educational scholarships that provide positive social and economic benefits. Here are AAA’s answers to the fiscal responsibility and governance questions:
• Does the SGO have clean (“unqualified”) audits/reviews for the past three years?
Yes! Here is a link to our past 5 years of unqualified financial and operational audit reports.
• Does the SGO have demonstrated success raising scholarship funds?
Yes! Here is a link to our IRS Form 990 for the past 5 years showing continual success in raising scholarship funds.
• What is their staff experience in successfully running non-profit organizations?
AAA’s leadership has been involved in running education non-profits since 1998 and have administered educational scholarships since 2002.
•What is their experience successfully rolling out and implementing new scholarship programs?
AAA’s staff successfully rolled out the Florida Tax Credit Scholarship Program (2002), the Florida Personal Learning Scholarship Program, currently known as FES-UA (2015), and the Nevada Opportunity Scholarship Program (2015)
• How many scholarships and grants did the SGO award for the prior school year and what was the total dollar amount awarded?
AAA awarded 11,826 scholarships worth $69,605,983 and $69,850,000 in grants during FY23-24.
• Does the SGO have an outside party endorsement for good practices (i.e. Charity Navigator or Guide Star/Candid)?
Yes, AAA has a Platinum rating from Guide Star/Candid and a Four-star rating from Charity Navigator. The prestigious Guide Star Platinum Seal demonstrates the highest level of good management practices in a non-profit organization. The Four-Star Rating from Charity Navigator designates AAA as an official “Give with Confidence” charity, indicating that our organization is using its donations effectively.
• What are outside stakeholders (parents/schools/donors) saying about their experience with the SGO?
Outside stakeholders continually report high to very high levels of satisfaction with AAA.
• Does the SGO outsource their technology and / or customer service to third parties?
No, AAA’s customer service reps are our own U.S. based employees and we leverage our own proprietary Scholarship Management Platform to ensure direct control over quality, efficiency, communications and compliance processes. Be wary of SGOs that outsource these critical processes as they carry unique risks that can undermine reliability, security, and trust from regulators and stakeholders.
• What types and levels of insurance policies does the SGO have in place?
AAA maintains the following insurance policies: $2 million of general liability, $1 million of non-profit directors & officers’ liability and employment practices liability, $1 million of crime and theft (including computer fraud) insurance, and $500,000 of workers compensation and employers’ liability.
We look forward to working with you to put your federal tax credits to work for the next generation of Americans!
EXPERIENCE
AAA has administered over $800 million of tax credit scholarships and education savings accounts (“ESAs”) since 2010—making us one of the most trusted names in education tax credits. Let us help you learn how to invest in education tax credits.
IMPACT
AAA has leveraged funding from tax credits to assist tens of thousands of economically disadvantaged students successfully secure the resources needed to access quality k-12 educational options. These scholars go on to pull their families out of a vicious cycle of generational poverty, revitalizing communities, and reinvigorated local economies.
By investing in AAA tax credits, our donors know that their redirected tax dollars are helping children living in underserved communities to access the high-quality education that will set them on the path to future success, to contributing back to their communities, and to more fully participating in the American dream.