Students First Education Savings Accounts

The Students First Act, introduced by Governor Reynolds and signed into law on Jan. 24, 2023, makes state funding available to support the success of every K-12 student in Iowa. The bill establishes a framework and funding for education savings accounts (ESAs), which may be used by eligible families to cover tuition, fees, and other qualified education expenses at accredited nonpublic schools in Iowa.

The State Board of Education adopted administrative rules on May 4, 2023, that specify definitions for the program, eligibility requirements for participation, parameters for the application process, and program administration and accountability.

Apply for Students First ESA

The Students First ESA Application available in English and Spanish. The application window for the 2023-2024 school year runs from 8 a.m. on May 31 through 11:59 p.m. June 30, 2023.

Note: Parents/guardians will first be directed to sign up with an email and password. Parents/guardians will receive a message from Odyssey asking them to confirm their email address. After the email is confirmed the parent/guardian can sign in to the Odyssey platform to begin their application.

How it Works

Parents who choose to enroll their eligible children in an accredited nonpublic school will receive an amount equal to the per pupil funding allocated to public school districts for the same budget school year. Funds will be deposited into an education savings account (ESA) to be used for tuition, fees, and other qualified education expenses as specified in the legislation.

The state has signed a contract with Odyssey to manage program administration for Students First Education Savings Accounts, including applications, financial transactions, compliance, fraud prevention and customer service. Odyssey was selected through a competitive bid process based on its ability to securely administer funds, provide families with direct customer service and support and offer the state real-time insight into the program’s effectiveness.

Who is Eligible

Students First ESAs will be available based on the following eligibility:

Year 1: School Year 2023-2024

• All entering kindergarten students
• All students enrolled in a public school
• A student enrolled in an accredited nonpublic school with a household income at or below 300% of the 2023 Federal Poverty Guidelines, $90,000 for a family of four

Year 2: School Year 2024-2025

• All entering kindergarten students
• All students enrolled in a public school
• A student enrolled in an accredited nonpublic school with a household income at or below 400% of the 2024 Federal Poverty Guidelines that will be updated January 2024

Year 3: School Year 2025-2026

• All K-12 students in Iowa regardless of income

Questions and Answers

Updated: 5-26-23

Answers to frequently asked questions will be posted regularly on this webpage. Send your questions to studentsfirst@iowa.gov or call 515-954-5652.

Application

1. When will the application be available for families to set up a Students First ESA?

The Students First ESA Application available in English and Spanish. The application window for the 2023-2024 school year runs from 8 a.m. on May 31 through 11:59 p.m. June 30, 2023.

2. I have two students who will be attending an Iowa accredited nonpublic school in the 2023-2024 school year. Do I have to create an application for each student?

No. Only one application per family is needed. Parents/guardians can add multiple students from their household onto their application.

3. How should I answer the question "Did this student attend an Iowa accredited nonpublic school in the 2022-2023 school year” if my child only attended the nonpublic school on a part-time basis?

If a student attended an accredited nonpublic school in 2022-2023, in any grade K-12, even for a single day, the parent or guardian should say "Yes" to the question of whether or not the student attended an accredited nonpublic school in 2022-2023.

4. Who sees my application information?

Application information will only be viewed by parties necessary to complete the application verification and approval process, which includes Odyssey, the Iowa Department of Education and the Iowa Department of Revenue.

5. How long will it take to know if my application has been approved?

Applications that are able to be verified through the automatic review processes (e.g., verify residency through Iowa 2022 State Tax Return) should receive a response within 30 minutes of completion. Applications that require additional documentation verification or manual review will take additional processing time.

6. If I identify the school my child plans to attend within the Odyssey system on July 15, does that mean my child is enrolled at that school?

No. Applying for enrollment to an Iowa accredited nonpublic school is a separate process from applying for an ESA through the Odyssey platform. Identifying the school that the student plans to attend in the Odyssey application has no bearing on whether the student will be admitted to that school. Nonpublic school enrollment is unrelated to the Students First ESA application and is strictly between the family and the school.

Eligibility

1. What information do I need to set up a Students First ESA for my child?

Parents/Guardians applying will need the following information to set up a Students First ESA:

• Parent/Guardian Legal Name
• Parent/Guardian Contact Information (email address and phone number that can receive text messages for updates) and Preferred Language (English or Spanish)
• Parent/Guardian Current Residential Address
• Address used for the 2022 Iowa State Tax Return, if different from current address 
• Parent/Guardian ID Social Security Number or Individual Taxpayer Identification Number)
• Parent/Guardian Spouse ID (Social Security Number or Individual Taxpayer Identification Number)
• Student’s Legal Name
• Student’s Date of Birth
• Student’s Residential Address (if it is different from the parent/guardian address)

2. What information will be used to verify Iowa residency?

Proof of Iowa residency is based on the parent/guardian’s 2022 Iowa State Tax Return. If the parent/guardian did not complete a 2022 Iowa State Tax Return, additional documentation will be required. Details of approved documents to submit for residency verification are listed below.

Approved Residency Verification Documents

• Current Iowa Driver’s License
  OR
• Proof of Residence (current mortgage, lease, utility bill) and one of the following:
  • Iowa Voter Registration Card
  • Claim of Homestead Credit or Military Tax Exemption on a home in Iowa
  • Active checking or savings account with an Iowa address
  • Other documents and correspondence initiated during tax periods with an Iowa address
    OR
• Other written and signed narrative from parent/guardian including a stated claim of Iowa residency, and other related documentation reflecting residency.

3. Does my student need to be enrolled full time?

Yes. Students must be enrolled full time at an accredited nonpublic school and attend classes for at least 75 percent of the full-time schedule.

4. Can I use ESA funds to pay preschool tuition for my child?

No. ESA funds can only be used for students in kindergarten through 12th grade.

5. My child was in an accredited nonpublic school Pre-K program during the 2022-2023 school year. Will my child qualify for an ESA as an incoming kindergartener for the 2023-2024 school year?

Yes. As long as Iowa residency can be established, all incoming kindergarteners who are five years of age by September 15, 2023 are eligible for an ESA in the 2023-2024 school year, regardless of income.

6. If my kindergartener is eligible for an ESA for the 2023-2024 school year, will a payment be received in the ESA again the following year when my child is in first grade?

Any student who is approved for an ESA in the 2023-2024 school year and remains an Iowa resident is automatically eligible for ESA funding in 2024-2025. For an ESA to be funded an annual application will still need to be submitted through the Odyssey platform. All Iowa K-12 students attending an Iowa accredited nonpublic school are eligible for an ESA in the 2025-2026 school year.

7. My student attended an Iowa public school in the 2022-2023 school year and will be enrolling in an Iowa accredited nonpublic school for the 2023-2024 school year. Is my student eligible for an ESA even if we are above the income level?

Yes. All students who attended a public school in the 2022-2023 school year and choose to enroll in an accredited nonpublic school for the 2023-2024 school year are eligible and not subject to income requirements.

8. Our children already attend an accredited nonpublic school. When are they eligible for an ESA?

In the first two years of Iowa’s ESA program, eligibility for students who were enrolled in an Iowa accredited nonpublic school during the 2022-2023 school year is based on household income.

For the 2023-2024 school year, families with household incomes at or below 300% of the federal poverty level (FPL) are eligible.
The level increases to at or below 400% FPL for the 2024-2025 school year.

Beginning in the 2025-2026 school year, all K-12 students, including those who already attend an accredited nonpublic school, are eligible for an ESA regardless of household income.

9. My children attend an Iowa accredited nonpublic school and we receive tuition assistance from a STO. Are we also eligible for an ESA?

ESA eligibility should not impact tuition assistance eligibility from an STO.

10. How do I know if my family meets the income requirements to be eligible for the ESA?

In the 2023-24 school year, only families whose children were enrolled in an Iowa accredited nonpublic school will need to meet income eligibility requirements. Families with a household income at or below 300% of the 2023 Federal Poverty Guidelines are eligible. See matrix below.

Persons in Family/Household	Poverty Guideline	300% of Poverty Guideline
1	$14, 580	$43,740
2	$19,720	$59,160
3	$24,860	$74,580
4	$30,000	$90,000
5	$35,140	$105,420
6	$40,280	$120,840
7	$45,420	$136,260
8	$50,560	$151,680

Note: The income limitation only applies if the student attended an Iowa accredited nonpublic school in the 2022-2023 school year.

11. How is “household” defined?

“Household” means the number of people who reside together and who are related by birth, marriage, adoption, legal guardianship or by placement in the home through a state agency. 

Household includes parents/guardians, student applicants, and other children who share at least one parent by birth, adoption, by a parent/guardian's current marriage or by placement in the home through a state agency. 

A parent on military duty is considered to be residing in the household.

If  “household” cannot be clearly determined through review of the submitted tax return, additional information may be requested to determine eligibility.

12. What line on my Iowa tax form is used to identify household income when determining eligibility for an ESA?

On the 2022 Iowa 1040 tax form, line 26 (“Net Income”) is used to identify household income.

13. My family just moved to Iowa. Are my students eligible for an ESA?

Yes, as long as Iowa residency can be established by the June 30 application deadline.

14. We live in Council Bluffs, near the Nebraska border. Can my kids use their ESA funds to attend an accredited nonpublic school in Omaha since it’s close to our home?

No. Iowa’s Students First ESAs can only be used to attend an Iowa accredited nonpublic school.

15. I am a current resident of Iowa but did not file a 2022 Iowa State Tax Return. Are my students eligible for an ESA?

Applications that are not able to be verified through the automatic review process will require additional documentation to verify proof of residency and/or income requirements.

16. My student was homeschooled in the 2022-2023 school year and will be enrolling in an Iowa accredited nonpublic school for the 2023-2024 school year. Is my student eligible for an ESA?

Yes, they would be eligible for an ESA regardless of income as long as they are enrolled as a full-time student at an accredited nonpublic school.

17. We homeschool our children. Are they eligible for an ESA if they enroll to take 1-2 classes at an accredited nonpublic school?

No. One of the eligibility requirements for an ESA is full-time enrollment in an accredited nonpublic school.

18. My student will be switching schools from an Iowa accredited nonpublic school to public school or homeschool for the 2023-2024 school year. Is my student eligible for an ESA?

No. Education savings accounts are available only to eligible students who attend an Iowa accredited nonpublic school.

19. My student is switching schools in the middle of the semester. Will I still be able to use funds in the ESA?

If the student plans to switch schools in the middle of the semester from an Iowa accredited nonpublic school to a public school or homeschool, the unused funds will remain in the account and can be used in a future year if the student becomes eligible again. 

If the student is switching from one Iowa accredited nonpublic school to another Iowa accredited nonpublic school and there are remaining funds in the ESA, funds may continue to be used as long as the student remains enrolled in the new accredited nonpublic school.

20. How will this work if my child lives in a split household?

It is the responsibility of the parents/guardians to determine the correct person to complete the application and manage the ESA funds. The first parent/guardian to apply who meets the eligibility requirements will be the parent/guardian under which the ESA is established. For an application to be contested, court documents supporting the contesting person’s position as the parent/guardian that has education making authority are required for consideration.

Note: The percent of custody or parenting time does not determine the parent/guardian who  has the authority for educational decisions.

21. My family is moving within Iowa. Are my students eligible for an ESA?

Moving within Iowa does not affect eligibility. The same program eligibility requirements apply.

22. Do both parents/guardians have to complete the form, or does the Iowa Department of Revenue verify through joint tax returns?

Only one application per family is needed to apply for the Students First Act ESA program, therefore only one parent/guardian needs to apply.

For married applicants, the SSN or ITIN of the spouse of the parent/guardian will also be included in the application. Both applicants will be required to electronically sign the application.

23. What information will be used to verify income restrictions if I did not complete a 2022 Iowa State Tax Return?

Income verification is only required for students who attended an Iowa accredited nonpublic school in the 2022-23 school year, and will not be attending kindergarten for the 2023-24 school year.

If the parent/guardian did not complete a 2022 Iowa State Tax Return, additional documentation will be required. Details of approved documents to submit for income requirement verification are listed below:

Approved Income Restriction Verification Documents

• Existing Iowa resident:
  • Proof of enrollment in an Iowa program that has an income eligibility component that is below the income threshold.
  • Eligible programs: SNAP, child care assistance, or cash assistance
  • Required documentation: Iowa HHS Notice of Decision or image of SNAP card with matching parent name
• New Iowa resident:
  • 2022 tax return from another state, or
  • Most recent pay stub for both parents/guardians and letter from each employer verifying annual income for the employee, or
• If the information above is not available: Other situation requires (1) written and signed narrative of situation from parent/guardian, (2) stated claim of net income and household size, and (3) related documentation proving net income and/or household size (e.g., divorce decree in the case of divorce, unemployment letter in the case of unemployment)

24. Will ESA Funds need to be reported as taxable income?

For Iowa tax purposes, ESA funds are not taxable income if the funds are used for eligible educational expenses (e.g., tuition and fees, tutoring). See Eligible and Ineligible Expenses.

For federal tax purposes, ESA funds are treated differently. ESA funds used for tuition and fees are not taxable. However, ESA funds used for other types of services (e.g., tutoring, educational therapies) are considered taxable. 

Funding

1. When will I receive my funds?

Funds will be available for use in the ESA as of July 15, 2023, or 30 days after the application is verified and approved, whichever is later.

2. How much will my student receive?

The per student funding for the 2023-24 school year will be $7,635. Half of the funds ($3,817.50) will be available for use in the Fall 2023 semester and the remaining half will be available for use in the Spring 2024 semester.

3. I have a child that will be in kindergarten in the fall. The amount of her tuition and fees is less than the amount of the ESA funding. Can I use the remaining funds from her ESA to pay tuition and fees for one of my other children?

No. ESA eligibility and funding awarded is specific to the individual students. ESA funds from one account may not be used to pay for costs related to another student, regardless if that student is also an ESA participant.

Information for Families

Application Training Webinar Recordings

Application Training Webinar Recording for Families - Recorded 5-23-23. Provides an overview of Iowa's Students First Education Savings Account (ESA) application platform and process, including eligibility criteria, required documentation and the verification and approval process. PowerPoint for Families

Spanish Application Training Webinar Recording for Families - Recorded 5-26-23. Spanish PowerPoint for Families

Iowa’s Students First Act ESA Program: Eligible and Ineligible Expenses

2023-24 Iowa Nonpublic School Building Directory

Parent or Guardian Appeal Rights

Sign up for Notifications

This webpage will be updated as new information is available. Sign up to receive email notifications when updates are made to this page.

Information for Accredited Nonpublic Schools

Iowa’s Students First Act ESA Program: Accredited Nonpublic School FAQs (6-19-23)

Odyssey Training Webinar Recording for Nonpublic Schools (5-17-23) - PowerPoint for Nonpublic Schools

Verifying Students and Entering Tuition and Fees (7-25-23) - Odyssey Training Webinar Recording for Nonpublic Schools

Information for Vendors

Iowa’s Students First Act ESA Program: Vendor FAQs

Vendor Registration

Categorical Funding

Other student funding generated by categorical funding formulas will remain with public school districts. This will include funding for students who choose to leave their public school, and for all students who live in the district but attend an accredited nonpublic school. It’s estimated that Iowa’s public schools will receive approximately $1,205 per pupil in categorical funding for students enrolled in accredited nonpublic schools.