South Carolina has begun organizing applications from nonprofits seeking to participate in the federal scholarship tax credit for 2027, assigning the Department of Revenue a central administrative role. Governor Henry McMaster’s October 13 executive order directs the agency to create and receive applications and compile a list of complete submissions. The governor’s announcement gives interested scholarship-granting organizations a state contact for applying.

The change is a preparatory step, not the start of a 2026 tax benefit or an automatic scholarship award to families. The Internal Revenue Service says the new Federal Scholarship Tax Credit begins January 1, 2027. The South Carolina order concerns organizations seeking recognition under that program, rather than applications from individual students or parents.

Revenue collects applications; the governor submits the list

The order requires Revenue to provide the governor’s office, by February 1, 2027, with a list of organizations that submitted complete applications. That is the agency’s reporting deadline; the document does not label it as a deadline for families to apply for scholarships. The state announcement tells prospective organizations to apply by emailing SGOapplication@dor.sc.gov.

McMaster had already elected South Carolina’s participation for 2027 on January 13, according to the executive order. The IRS participation page lists South Carolina among states that made an advance election. Participation and organizational certification remain distinct: the state must also identify qualifying scholarship-granting organizations for the federal program.

A credit for donations, not a payment to every parent

Under the IRS overview, individual taxpayers may be eligible for a federal credit for certain cash contributions of up to $1,700 to qualifying organizations. The agency’s October implementation update describes the credit as nonrefundable and explains that the organizations use contributions to provide scholarships for eligible elementary and secondary education expenses. The donor incentive should not be confused with a guaranteed $1,700 scholarship for each child.

The federal update says eligible organizations generally must be public charities, keep qualified contributions separate, meet scholarship and operating requirements, and appear on the applicable state list. Its examples of qualified expenses include tuition, tutoring, books, supplies and certain other educational services. Eligibility, organizational participation and an individual scholarship decision are therefore separate questions.

There is also a federal timetable beyond South Carolina’s internal February 1 milestone. Temporary Treasury regulations published October 2, effective December 1, provide a 2027 transition allowing a state to complete its advance election by submitting its organization list by February 15, 2027. The regulations require information and certifications about participating organizations; a state’s advance election alone is not the entire process.

For South Carolina organizations, the immediate development is the Revenue application contact and the new administrative assignment. For families and potential donors, the IRS’s 2027 start date and qualification requirements remain important limits. The October order establishes how the state will assemble its roster; it does not itself approve a named organization or promise any household a scholarship.