I 
114TH CONGRESS 
1ST SESSION H. R. 1511 
To amend the Internal Revenue Code of 1986 to allow a credit against 
tax for qualified elementary and secondary education tuition. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 19, 2015 
Mr. ROKITA (for himself and Mr. FRANKS of Arizona) introduced the fol-
lowing bill; which was referred to the Committee on Ways and Means, 
and in addition to the Committee on Education and the Workforce, for 
a period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned 
A BILL 
To amend the Internal Revenue Code of 1986 to allow a 
credit against tax for qualified elementary and secondary 
education tuition. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Educational Opportu-
nities Act’’. 
SEC. 2. TAX CREDIT FOR CONTRIBUTIONS TO SCHOLAR-
SHIP GRANTING ORGANIZATIONS. 
(a) CREDIT FOR INDIVIDUALS.— 
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(1) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code 
of 1986 is amended by inserting after section 25D 
the following new section: 
‘‘SEC. 25E. QUALIFIED ELEMENTARY AND SECONDARY EDU-
CATION TUITION. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax 
imposed by this chapter for the taxable year an amount 
equal to the amount of qualified contributions made by 
the taxpayer during the taxable year. 
‘‘(b) DOLLAR LIMITATION.—The amount allowed as 
a credit under subsection (a) with respect to any taxpayer 
shall not exceed— 
‘‘(1) $2,250, in the case of a married individual 
filing a separate return, and 
‘‘(2) $4,500, in any other case. 
‘‘(c) QUALIFIED CONTRIBUTIONS; OTHER DEFINI-
TIONS.—For purposes of this section— 
‘‘(1) QUALIFIED
CONTRIBUTION.—The term 
‘qualified contribution’ means a charitable contribu-
tion (as defined by section 170(c)) to a scholarship 
granting organization. 
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‘‘(2) 
SCHOLARSHIP
GRANTING
ORGANIZA-
TION.—The term ‘scholarship granting organization’ 
means any organization— 
‘‘(A) 
which 
is 
described 
in 
section 
501(c)(3) and exempt from tax under section 
501(a), 
‘‘(B) whose exclusive purpose is to provide 
scholarships for the qualified elementary and 
secondary education expenses of eligible stu-
dents, and 
‘‘(C) which meets the requirements of sub-
section (d). 
‘‘(3) ELIGIBLE STUDENT.—The term ‘eligible 
student’ means an individual— 
‘‘(A) who is enrolled in an elementary or 
secondary school (within the meaning of section 
530(b)(3)(B), after the application of para-
graph (4)(B)), and 
‘‘(B) who is a member of a household with 
a total annual household income which does not 
exceed 250 percent of the Federal poverty 
guidelines (as determined by the Secretary of 
Health and Human Services). 
‘‘(4) QUALIFIED ELEMENTARY AND SECONDARY 
EDUCATION
EXPENSES.—The term ‘qualified ele-
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mentary and secondary education expenses’ has the 
meaning given such term by section 530(b)(3), ex-
cept that— 
‘‘(A) ‘child’ shall be substituted for ‘bene-
ficiary’ and ‘a child’ shall be substituted for 
‘the designated beneficiary of the trust’ in 
clauses (i) and (iii) of subparagraph (A) there-
of, and 
‘‘(B) in applying such paragraph, the term 
‘school’ shall only include schools which— 
‘‘(i) charge tuition for attendance, 
‘‘(ii) comply with all applicable State 
laws, including laws relating to unlawful 
discrimination, health and safety require-
ments, and criminal background checks of 
employees, and 
‘‘(iii) agree to provide annual reports 
as described in subsection (e) to a scholar-
ship granting organization and to the par-
ents or guardians of eligible students re-
ceiving a scholarship from the scholarship 
granting organization. 
‘‘(5) SCHOLARSHIP.—The term ‘scholarship’ 
does not include any payment to fulfill or fund any 
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obligation or project of any school or school system 
to provide a free, appropriate public education. 
‘‘(d) REQUIREMENTS FOR SCHOLARSHIP GRANTING 
ORGANIZATIONS.—An organization meets the require-
ments of this section if— 
‘‘(1) such organization does not provide grants 
to eligible students for any expenses other than 
qualified elementary and secondary education ex-
penses, 
‘‘(2) such organization provides grants to— 
‘‘(A) more than 1 student, and 
‘‘(B) different students attending more 
than 1 school, 
‘‘(3) such organization does not earmark or set 
aside contributions for scholarships on behalf of any 
particular student or to any specific school or group 
of schools, 
‘‘(4) such organization takes appropriate steps 
to verify the annual household income and family 
size of eligible students to which it provides grants, 
‘‘(5) such organization obtains annual audits 
from an independent certified public accountant and 
submits such audits to the Secretary, 
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‘‘(6) no employee of such organization has vio-
lated any law relating to the audit described in para-
graph (4), and 
‘‘(7) such organization— 
‘‘(A) requires any eligible student who re-
ceives a scholarship— 
‘‘(i) to participate in the evaluation 
conducted by the Institute of Education 
Science under section 2(d) of the Edu-
cational Opportunities Act, and 
‘‘(ii) to permit such organization to 
share assessment information and other 
data regarding the student with the Insti-
tute in accordance with subparagraph (B), 
and 
‘‘(B) provides the reports described in sub-
section (e)(1)(C) and such other information as 
necessary to the Director of the Institute of 
Education Science for the purposes of identi-
fying eligible students receiving a scholarship 
from such organization and conducting the eval-
uations and reports required under section 2(d) 
of the Educational Opportunities Act. 
For purposes of paragraph (5), the term ‘inde-
pendent certified public accountant’ means, with re-
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spect to an organization, a certified public account-
ant which is not a related person (within the mean-
ing of section 465(b)(3)(C)) with respect to such or-
ganization or any employee of such organization. 
‘‘(e) ELIGIBLE
SCHOOL
REPORTING
REQUIRE-
MENT.— 
‘‘(1) IN GENERAL.—The reports described in 
this subsection include— 
‘‘(A) a report to the parents on the stu-
dent’s academic achievement, including a com-
parison with the aggregate academic achieve-
ment of other students in the same grade or 
level at the school who receive a scholarship 
from a scholarship granting organization, if 
available, and 
‘‘(B) a report, to each scholarship granting 
organization that provides scholarships to stu-
dents at the school, that includes— 
‘‘(i) the test results, in the aggregate 
and disaggregated by race or ethnicity and 
grade level, of the students receiving such 
scholarships who are in grades 3 through 
12 on a grade-appropriate nationally norm- 
referenced standardized test, or a grade- 
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appropriate State-recognized assessment, 
and 
‘‘(ii) any additional data requested by 
the Director of the Institute of Education 
Sciences 
in 
accordance 
with 
section 
2(d)(B) of the Educational Opportunities 
Act. 
‘‘(2) NO PERSONALLY IDENTIFIABLE INFORMA-
TION.—In preparing and submitting the report de-
scribed in paragraph (1)(B), a school shall not in-
clude any personally identifiable information regard-
ing a student. 
‘‘(f) DENIAL OF DOUBLE BENEFIT.—No deduction 
shall be allowed under any provision of this chapter for 
any expense for which a credit is allowed under this sec-
tion. 
‘‘(g) ELECTION.—This section shall apply to a tax-
payer for a taxable year only if such taxpayer elects to 
have this section apply for such taxable year.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions for subpart A of part IV of subchapter A of 
chapter 1 of such Code is amended by inserting 
after the item relating to section 25D the following 
new item: 
‘‘Sec. 25E. Qualified elementary and secondary education tuition.’’. 
(b) CREDIT FOR CORPORATIONS.— 
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(1) IN GENERAL.—Subpart D of part IV of 
subchapter A of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the 
following new section: 
‘‘SEC. 45S. CONTRIBUTIONS TO SCHOLARSHIP GRANTING 
ORGANIZATIONS. 
‘‘(a) GENERAL RULE.—For purposes of section 38, 
in the case of a corporation, the education scholarship 
credit determined under this section for the taxable year 
is the aggregate amount of qualified contributions for the 
taxable year. 
‘‘(b) LIMITATION.—The amount of the credit deter-
mined under this section for any taxable year shall not 
exceed $100,000. 
‘‘(c) QUALIFIED CONTRIBUTIONS.—For purposes of 
this section, the term ‘qualified contribution’ has the 
meaning given such term under section 25E. 
‘‘(d) DENIAL OF DOUBLE BENEFIT.—No deduction 
shall be allowed under any provision of this chapter for 
any expense for which a credit is allowed under this sec-
tion. 
‘‘(e) ELECTION.—This section shall apply to a tax-
payer for a taxable year only if such taxpayer elects to 
have this section apply for such taxable year.’’. 
(2) CONFORMING AMENDMENTS.— 
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(A) Section 38(b) of such Code is amended 
by striking ‘‘plus’’ at the end of paragraph 
(35), by striking the period and inserting ‘‘, 
plus’’ at the end of paragraph (36), and by 
adding at the end the following new paragraph: 
‘‘(37) the education scholarship credit deter-
mined under section 45S(a).’’. 
(B) The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of such 
Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45S. Contributions to scholarship granting organizations.’’. 
(c) EXCISE TAX
ON FAILURE
OF SCHOLARSHIP 
GRANTING ORGANIZATIONS TO MAKE DISTRIBUTIONS.— 
(1) IN GENERAL.—Chapter 42 of the Internal 
Revenue Code of 1986 is amended by adding at the 
end the following new subchapter: 
‘‘Subchapter H—Scholarship Granting 
Organizations 
‘‘Sec. 4968. Tax on failure to distribute receipts. 
‘‘SEC. 4968. TAX ON FAILURE TO DISTRIBUTE RECEIPTS. 
‘‘(a) TAX IMPOSED.—There is hereby imposed a tax 
on the failure of a scholarship granting organization (as 
defined in section 25E(c)(2)) to make distributions in any 
taxable year in an amount equal to or in excess of the 
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required distribution amount before the distribution dead-
line. 
‘‘(b) AMOUNT OF TAX.—The tax imposed by sub-
section (a) shall be equal to 15 percent of the excess (if 
any) of— 
‘‘(1) the required distribution amount with re-
spect to the taxable year, over 
‘‘(2) the amount of receipts of the scholarship 
granting organization for such taxable year which 
are distributed before the distribution deadline with 
respect to such receipts. 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) REQUIRED DISTRIBUTION AMOUNT.—The 
required distribution amount with respect to a tax-
able year is the amount equal to 90 percent of the 
total receipts of the scholarship granting organiza-
tion for such taxable year. 
‘‘(2) DISTRIBUTIONS.—The term ‘distribution’ 
includes amounts which are formally committed but 
not distributed. 
‘‘(3) DISTRIBUTION DEADLINE.—The distribu-
tion deadline with respect to receipts for a taxable 
year is the first day of the second taxable year fol-
lowing the taxable year in which such receipts are 
received by the scholarship granting organization. 
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‘‘(d) REASONABLE CAUSE EXCEPTION.—The tax im-
posed by subsection (a) shall not apply with respect to any 
failure to make required distributions before the distribu-
tion deadline which is not willful and is due to reasonable 
cause.’’. 
(2) ABATEMENT OF TAX.— 
(A) GENERAL
RULE.—Subsection (b) of 
section 4962 of such Code is amended by strik-
ing ‘‘or G’’ and inserting ‘‘G, or H’’. 
(B) FIRST TIER TAX.—Subsection (a) of 
section 4963 of such Code is amended by in-
serting ‘‘4968,’’ after ‘‘4967,’’. 
(C) TAXABLE EVENT.—Subsection (c) of 
section 4963 of such Code is amended by in-
serting ‘‘4968,’’ after ‘‘4967,’’. 
(3) CORRECTION PERIOD.—Subparagraph (A) 
of section 4963(e)(2) of such Code is amended by in-
serting ‘‘or 4968’’ after ‘‘4942’’. 
(4) CONFORMING AMENDMENT.—The table of 
subchapters for chapter 42 of such Code is amended 
by adding at the end the following new item: 
‘‘SUBCHAPTER H. SCHOLARSHIP GRANTING ORGANIZATIONS.’’. 
(d) EVALUATIONS.— 
(1) DEFINITIONS.—In this section— 
(A) the terms ‘‘eligible student’’, ‘‘qualified 
elementary and secondary education expenses’’, 
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and ‘‘scholarship granting organization’’ have 
the meanings given such terms in section 
25E(c) of the Internal Revenue Code of 1986, 
as added by this Act; 
(B) the term ‘‘Director’’ means the Direc-
tor of the Institute of Education Sciences; and 
(C) the term ‘‘participating student’’ 
means an eligible student who receives a schol-
arship for qualified elementary and secondary 
education expenses from a scholarship granting 
organization. 
(2) EVALUATIONS.— 
(A) IN GENERAL.—By not later than April 
1 of the year following the year of the date of 
enactment of this Act, and by April 1 of each 
subsequent year, the Director shall conduct an 
annual evaluation to determine the effectiveness 
of scholarships provided by scholarship granting 
organizations to eligible students in improving 
the academic achievement and success of the el-
igible students. 
(B) CONTENTS OF THE EVALUATION.—In 
conducting the evaluation required under this 
subsection, the Director shall— 
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(i) request, from each scholarship 
granting organization, the reports provided 
to the scholarship granting organization by 
the schools accepting participating stu-
dents, 
in 
accordance 
with 
section 
25E(e)(1)(B); 
(ii) using the reports described in 
clause (i), assess the academic achievement 
of all participating students in grades 3 
through 12, based on the nationally norm- 
referenced standardized test or State-rec-
ognized assessment used by each school; 
(iii) evaluate the school retention 
rates, secondary school graduation rates, 
and institution of higher education admis-
sion rates of participating students; 
(iv) evaluate the success of the tax 
credits allowed under sections 25E and 
45S of the Internal Revenue Code of 1986, 
as added by this Act, in expanding school 
choice options for parents of participating 
students, increasing the satisfaction of 
such parents and students, and increasing 
parental involvement of such parents in the 
education of their students; and 
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(v) evaluate such other issues with re-
spect to the education of participating stu-
dents as the Director considers appropriate 
for inclusion in the evaluation. 
(3) REPORTS.—By not later than April 1 of the 
year after the year of the first evaluation under 
paragraph (2), and by April 1 of each subsequent 
year, the Director shall submit to the Committee on 
Ways and Means and the Committee on Health, 
Education, Labor, and Pensions of the Senate, and 
the Committee on Finance and the Committee on 
Education and the Workforce of the House of Rep-
resentatives, an annual report on scholarships pro-
vided by scholarship granting organizations that in-
corporates the results of the most recent evaluation 
described in paragraph (2). 
(4) PROHIBITION.—No personally identifiable 
information shall be disclosed in the data, evalua-
tions, and reports required under this subsection. 
(5) PUBLIC AVAILABILITY.—The Director shall 
make all evaluations, reports, and underlying data 
gathered pursuant to this subsection available to the 
public, upon request and in a timely manner fol-
lowing submission of the applicable report or evalua-
tion under this subsection, subject to paragraph (4). 
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