New for 2027 Payroll giving that pays your employees back.
NEW FEDERAL TAX CREDIT · JANUARY 1, 2027
Let Your Employees Send $1,700 to a Public School Reading Tutor Instead of the IRS
No cost to the company. No change to their take-home pay.
Starting January 1, 2027, the Federal Scholarship Tax Credit lets your employees donate up to $1,700 a year through payroll and claim it back, dollar for dollar, as a federal tax credit. We’ve built software that makes offering it nearly effortless: one secure authorization connects your payroll system, and EducationSuperHighway handles enrollment, receipts, and employee support from there. Sign up below to book a 20-minute call.
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WHY THIS MATTERS
America Has a Literacy Crisis.
First Grade Is Where It Starts.
The literacy gap isn’t just an education problem — it’s an economic one. And it begins in the earliest grades, before most people realize a child is falling behind.
67%
of America’s third-graders read below grade level.
Source: The Nation’s Report Card (NAEP)
28%
of American adults are functionally illiterate.
Source: NCES PIAAC 2023
$2.2T
lost from the U.S. economy every year due to low literacy.
Source: Gallup / Barbara Bush Foundation for Family Literacy
FOR EMPLOYERS
Employee Engagement for Companies
Partnering with EducationSuperHighway allows your business to support a cause your employees care about, enhance your brand, and strengthen your team around shared work — teaching kids to read. What makes the tax credit different is how little it costs. Employers make payroll giving available to staff at no charge, and employees give from federal taxes they already owe.
Payroll Giving
Enable employee donations to literacy tutoring scholarships through payroll deduction. Our payroll integration makes it easy.
Matching & Amplification
As a 501(c)(3), employee FSTC donations to EducationSuperHighway are eligible for your employee charitable giving matching program.
Employee Engagement
We supply everything you need to educate your employees on the tax credit and no cost giving through payroll deduction.
CSR Alignment
Helping solve America's literacy crisis supports workforce development and America's long-term economic growth.
$1,700
Maximum credit per taxpayer
Employees can donate up to $1,700 per year and claim it back, dollar for dollar, against the federal income tax they owe — not a deduction, a credit.
$0
Net Out-of-Pocket Cost
When paired with a W-4 withholding adjustment, take-home pay doesn’t change. Money that would have gone to the IRS goes to a child’s tutor instead.
8x
Impact of Your Donation
After receiving high-dosage literacy tutoring in first grade, the percentage of students reading at grade level rose from 6% to 48% — an 8x increase.
Source: Center for Research and Reform in Education, Johns Hopkins University
HOW PAYROLL GIVING WORKS
Set Up Once.
We Handle the Rest.
From payroll connection to tax receipt, our payroll integration means your team’s involvement takes minutes.
STEP 01
Connect payroll
Your payroll administrator completes one secure authorization. It takes about two minutes and is the only technical step your team takes.
STEP 02
Employees enroll
Employees open your company’s link, verify their identity with their work sign-in, and choose an amount. No app, no forms for HR.
STEP 03
We Set It Up
Our software adds each employee’s donation directly to your payroll system. Your team never creates or manages a code.
STEP 04
Employee Support
We confirm every enrollment and walk employees through the optional W-4 adjustment that keeps take-home pay level.
STEP 05
Each Payroll Cycle
Donations are made post-tax and show on pay stubs. Finance remits funds via ACH, and we reconcile them against payroll data.
STEP 06
Every January
We issue each employee the donation acknowledgment they need to claim the tax credit and send you a summary report.
Employees can change or stop their donation at any time through the same portal, and we answer their questions directly — your team doesn’t have to field them.
WHERE EVERY DONATION GOES
How We Choose Schools, Students, and Tutors
*Source: Center for Research and Reform in Education, Johns Hopkins University
Frequently Asked Questions
A federal tax credit created under Section 25F, effective January 1, 2027. Taxpayers who donate to an approved Scholarship Granting Organization can claim a dollar-for-dollar credit of up to $1,700 per year. EducationSuperHighway is a national education nonprofit and Scholarship Granting Organization.
Nothing. There are no platform fees or per-employee charges. Your team’s role is a short one-time setup, sharing an enrollment link we provide, and a simple monthly remittance. Our software and support team handle the rest.
About two minutes of technical work: one secure authorization that connects your payroll system to our platform. We create and manage the giving deduction, run enrollment, issue every tax receipt, and answer employee questions directly. No new vendor portal for your team to learn.
Yes. Our platform connects through a SOC 2 Type II certified payroll integration. Your payroll credentials are never visible to EducationSuperHighway, data is encrypted in transit and at rest, and you can revoke access at any time.
Yes, and it’s the simplest way to multiply the impact. One thing to know: the Education Freedom Tax Credit is available only to individual taxpayers, so a company match doesn’t earn the credit. Matches may be deductible as charitable contributions — consult your tax advisor about your company’s situation. Either way, every matched dollar funds more one-on-one literacy tutoring for first graders reading below grade level.
Your employees enroll and give through payroll as usual, and we report total employee contributions to you on your regular schedule. You can match at whatever rate your giving policy sets, and send the match to EducationSuperHighway directly — no separate platform or vendor required.
No. The program is a voluntary payroll deduction arrangement, not an employee benefit plan. Because your company’s role is limited to facilitating employee contributions to an independent nonprofit — and plays no part in determining who receives scholarships — it does not trigger ERISA coverage. No Form 5500 filing, Summary Plan Description, or claims process is required.
WHY EDUCATIONSUPERHIGHWAY?
Why Trust Us With Your Donation?
EducationSuperHighway was founded in 2012. Over a decade, EducationSuperHighway led the national effort to close the K-12 broadband gap — connecting 99.3% of America’s K-12 public schools to high-speed internet and 5 million low-income households to affordable broadband.
Today, EducationSuperHighway is turning those connections into opportunity. As a 501(c)(3) non-profit Scholarship Granting Organization, we are focused on closing the nation’s literacy gap — one first-grader at a time.
© 2026 EducationSuperHighway · A 501(c)(3) non-profit Scholarship Granting Organization. Our tools and resources are provided for educational purposes only and do not constitute tax, legal, or financial advice. Always consult a qualified tax professional. Credit regulations are subject to IRS finalization. · Official EFTC Fact Sheet.