(2) CLERICAL AMENDMENT.—The table of sub-
chapters for chapter 42 of such Code is amended by 
adding at the end the following new item: 
‘‘SUBCHAPTER I. SCHOLARSHIP GRANTING ORGANIZATIONS’’. 
SEC. 3. VOLUME CAP. 
(a) IN GENERAL.—For purposes of sections 25F(g) 
and 45AA(e) of the Internal Revenue Code of 1986 (as 
added by this Act), the volume cap applicable with respect 
to both such sections (in the aggregate) shall be 
$10,000,000,000 for calendar year 2024 and each subse-
quent year thereafter. Such amount shall be allocated by 
the Secretary of the Treasury (or the Secretary’s delegate) 
as provided in subsection (b), except that— 
(1) 10 percent of such amount shall be divided 
evenly among the States, and shall be available with 
respect to individuals residing in, and corporations 
created or organized in, such States, and 
(2) the amount of any allotment to a State 
under paragraph (1) for any calendar year which is 
not claimed by taxpayers described in such para-
graph during such calendar year shall be added to 
the allotment provided to such State under such 
paragraph for the subsequent calendar year. 
(b) FIRST-COME, FIRST-SERVE.—For purposes of 
applying the volume cap under this section, such volume 
cap shall be applied based on a first-come, first-serve 
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basis, as determined based on the date on which the tax-
payer made the qualified contribution. 
(c) REAL-TIME INFORMATION.—For purposes of this 
section, the Secretary of the Treasury (or the Secretary’s 
delegate) shall develop a system to track the amount of 
qualified contributions made during the calendar year for 
which a credit may be claimed under section 25F or 45AA 
of the Internal Revenue Code of 1986, with such informa-
tion to be updated in real time. 
(d) ANNUAL INCREASES.— 
(1) IN GENERAL.—In the case of the calendar 
year after a high use calendar year, the dollar 
amount otherwise in effect under subsection (a) for 
such calendar year shall be equal to 105 percent of 
the dollar amount in effect for such high use cal-
endar year. 
(2) HIGH USE CALENDAR YEAR.—For purposes 
of this subsection, the term ‘‘high use calendar 
year’’ means any calendar year for which 90 percent 
or more of the volume cap in effect for such cal-
endar year under subsection (a) is allocated to tax-
payers. 
(3) PREVENTION
OF
DECREASES
IN
ANNUAL 
VOLUME CAP.—The volume cap in effect under sub-
section (a) for any calendar year shall not be less 
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than the volume cap in effect under such subsection 
for the preceding calendar year. 
(4) PUBLICATION OF ANNUAL VOLUME CAP.— 
The Secretary of the Treasury (or the Secretary’s 
delegate) shall make publicly available the dollar 
amount of the volume cap in effect under subsection 
(a) for each calendar year. 
(e) STATES.—For purposes of this section, the term 
‘‘State’’ includes the District of Columbia. 
SEC. 4. EXEMPTION FROM GROSS INCOME FOR SCHOLAR-
SHIPS FOR QUALIFIED ELEMENTARY OR SEC-
ONDARY EDUCATION EXPENSES OF ELIGIBLE 
STUDENTS. 
(a) IN GENERAL.—Part III of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 is amended 
by inserting before section 140 the following new section: 
‘‘SEC. 139J. SCHOLARSHIPS FOR QUALIFIED ELEMENTARY 
OR SECONDARY EDUCATION EXPENSES OF 
ELIGIBLE STUDENTS. 
‘‘(a) IN GENERAL.—In the case of an individual, 
gross income shall not include any amounts provided to 
any dependent of such individual pursuant to a scholar-
ship for qualified elementary or secondary education ex-
penses of an eligible student which is provided by a schol-
arship granting organization. 
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‘‘(b) DEFINITIONS.—In this section, the terms ‘quali-
fied elementary or secondary education expense’, ‘eligible 
student’, and ‘scholarship granting organization’ have the 
same meaning given such terms under section 25F(c).’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for part III of subchapter B of chapter 1 of the In-
ternal Revenue Code of 1986 is amended by inserting be-
fore the item relating to section 140 the following new 
item: 
‘‘Sec. 139J. Scholarships for qualified elementary or secondary education ex-
penses of eligible students.’’. 
SEC. 5. ORGANIZATIONAL AND PARENTAL AUTONOMY. 
(a) PROHIBITION OF CONTROL OVER SCHOLARSHIP 
ORGANIZATIONS.— 
(1) IN GENERAL.— 
(A) TREATMENT.—A scholarship granting 
organization shall not, by virtue of participation 
under any provision of this Act or any amend-
ment made by this Act, be regarded as acting 
on behalf of any governmental entity. 
(B) NO GOVERNMENTAL CONTROL.—Noth-
ing in this Act, or any amendment made by this 
Act, shall be construed to permit, allow, encour-
age, or authorize any Federal, State, or local 
government entity, or officer or employee there-
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of, to mandate, direct, or control any aspect of 
any scholarship granting organization. 
(C) MAXIMUM FREEDOM.—To the extent 
permissible by law, this Act, and any amend-
ment made by this Act, shall be construed to 
allow scholarship granting organizations max-
imum freedom to provide for the needs of the 
participants without governmental control. 
(2) PROHIBITION OF CONTROL OVER NON-PUB-
LIC SCHOOLS.— 
(A) NO GOVERNMENTAL CONTROL.—Noth-
ing in this Act, or any amendment made by this 
Act, shall be construed to permit, allow, encour-
age, or authorize any Federal, State, or local 
government entity, or officer or employee there-
of, to mandate, direct, or control any aspect of 
any private or religious elementary or secondary 
education institution. 
(B) NO EXCLUSION OF PRIVATE OR RELI-
GIOUS SCHOOLS.—No Federal, State, or local 
government entity, or officer or employee there-
of, shall impose or permit the imposition of any 
conditions or requirements that would exclude 
or operate to exclude educational expenses at 
private or religious elementary and secondary 
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