Private K-12 Schools NAICS 611110

Mar 5, 2026 - Federal Education Tax Credit Program Adoption Continues

• Kentucky will be the 24th state to opt into a federal tax credit program that allows donors to receive a federal tax credit of up to $1,700 by donating to a nonprofit scholarship-granting organization if a bill passed by both state legislative houses is signed into law. Several lawmakers say that they plan to override a veto it if it comes. Organizations that receive donations can distribute the funds to families for things like private school tuition, tutoring, and transportation. The Federal Education Freedom Tax Credit reduces a donor's federal tax liability directly by the amount donated (up to $1,700) rather than merely reducing taxable income.
• Thirty-one states and Washington, DC, provide state tax subsidies to families that use 529 accounts to pay for K-12 private schooling as of November 2025, according to the Institute on Taxation and Economic Policy. States are not required to provide state tax breaks on top of federal tax breaks for private school tuition. The One Big Beautiful Bill Act, signed into law in July 2025, allowed 529 college savings accounts to be used for tuition at private K-12 schools. All but three of the 31 states not only allow money in 529 accounts to grow tax-free and to be used for K-12 tuition, but they also give parents a separate tax break for their initial contributions to these accounts, meaning that a private-school parent can get a tax break for putting money into an account and then withdrawing it immediately to pay for tuition.

• Private schools reported steady enrollment increases since the coronavirus pandemic but the momentum appears to be slowing, according to the Cato Institute. The proportion of schools reporting growth dropped by 15 percentage points from a peak of 55% between the 2021-22 and 2022-23 school years to 40% between the 2023-24 and 2024-25 school years. Some 32% of private schools saw enrollment decrease between the 2023-24 and 2024-25 school years and 28% reported no change, the Cato Institute said. Among schools with rising enrollment, 69% attribute the growth to "a values alignment between the school and parents." Other top reasons cited include a better academic experience (44%) and parents’ religious beliefs (43%).
• Private K-12 school industry employment has rebounded from pandemic-era lows and remained above pre-pandemic levels in late 2025, according to the US Bureau of Labor Statistics. Private K-12 school revenue is forecast to grow at a 3.86% compounded annual rate from 2025 to 2029, slower than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc. Sources of revenue for private schools include tuition, private grants, donations, fundraisers, and income from endowments.