School Tuition Organizations (STO) are charitable Iowa-based Section 501(c)(3) organizations that raise tuition grant funding for eligible Iowa students who enroll in accredited nonpublic, Iowa-based, elementary or secondary schools based on parent choice. Iowa taxpayers who donate to STOs are eligible for a tax credit equal to 75 percent of the total contribution. The STO must represent more than one school and 90 percent of its annual revenue must be used to provide tuition grants to eligible Iowa students to cover all or part of related tuition costs.
The total amount of authorized STO tax credit for the tax year beginning on or after Jan. 1, 2022 is $20,000,000. To be eligible for a tuition grant, a student’s family income must be no more than 400 percent of the federal poverty guidelines from the U.S. Department of Health and Human Services (Iowa Code 422.11S).