School Funding in Iowa

Students First ESA - universal since 2025-26 (all K-12 students eligible); ~$7,000-$8,000/student, tracks the state per-pupil cost.

School Tuition Organization (STO) tax-credit scholarship for families under 400% FPL.

Tuition and Textbook Tax Credit - 25% of the first $2,000 of K-12 tuition, textbook and supply expenses per dependent (up to $500). Cannot be claimed on expenses paid from Students First ESA funds.

Each student receives 100% of the state's regular-program per-pupil cost (minus administrative expenses): $7,826 for 2025-26, rising to roughly $8,148 for 2026-27. The amount tracks the per-pupil funding districts receive for the same year.

Who qualifies

Universal as of 2025-26: every Iowa resident student eligible to enroll in K-12 qualifies regardless of family income — the income-cap phase-in is fully eliminated.

Allowable expenses

• Tuition and fees at an accredited nonpublic school (must be paid first)
• Tuition or fees for nonpublic online education programs recognized by the DOE
• Tuition or fees for vocational and life-skills education recognized by the DOE
• Textbooks
• Curriculum and education materials
• Educational therapies, including tutoring
• Software
• Services for students with disabilities from an accredited provider

Reporting & oversight

All spending flows through the Odyssey platform: ESA funds may be used only with registered vendors in the Odyssey Marketplace and only for that vendor's eligible products/services; off-platform purchases do not qualify. Parents authorize transactions in-platform, then funds settle to the vendor (via Stripe, typically 2-5 business days). The tuition-first rule means accredited nonpublic-school tuition/fees must be paid before other categories. Operators/vendors must onboard as registered Odyssey Marketplace vendors to receive funds.

How to apply

Annual spring window through the Odyssey-managed platform; the 2025-26 window ran mid-April through June 30, 2025. Expect a comparable spring window for 2026-27.

Microschool and vendor operators must become registered Odyssey Marketplace vendors — off-platform spend is non-reimbursable. Vendor payments settle via Stripe (2-5 business days), so budget for the lag. Unused funds roll over while the student remains a participant, until graduation or age 20.

Verified 2026-06-30 from official sources: educate.iowa.gov, educate.iowa.gov, edchoice.org. Always confirm current rules with the program administrator before relying on them.