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Iowa lawmakers advance $4,000 tax credit for homeschool families
Supporters say it helps expand school choice; critics warn it lacks guardrails and could harm public education funding
Feb. 18, 2026 2:54 pm, Updated: Feb. 18, 2026 3:32 pm
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DES MOINES — Iowans who homeschool their kids would be eligible for a $4,000 tax credit per dependent, under legislation advanced Wednesday by a panel of Iowa House lawmakers as part of a broader push to expand school choice in the state.
House File 2078 is the latest move in Iowa’s broader push to expand school choice options following the state’s adoption of Education Savings Accounts (ESAs).
A three-member subcommittee advanced the bill, 2-1, with Republican Rep. Samantha Fett of Carlisle and Rep. Dan Gehlbach of Urbandale signing off to move it forward. Rep. Heather Matson, D-Ankeny, opposed the measure.
What the bill would do
Under the bill, parents or guardians could claim a $4,000 refundable tax credit for each dependent who meets three basic criteria: the child must be eligible to enroll in an Iowa public school, must not be enrolled in a public school district, and must not be receiving an Education Savings Account (ESA) payment for the same academic year.
Families would receive the full $4,000 per child even if the amount exceeds what they owe in state income taxes. Instead of waiting until tax season, parents could apply to receive the credit in advance.
The bill does not impose income restrictions, meaning eligibility would not be tied to household earnings. If enacted, the credit would apply retroactively to the tax year that began Jan. 1.
Beginning in 2028, the Iowa Department of Revenue would issue annual reports to lawmakers detailing the number of claims filed and identifying any known fraudulent activity.
The legislation creates a new “Opportunity Fund” in the state treasury, funded through ongoing appropriations from Iowa’s general fund to cover advance payments.
Supporters: ‘A matter of fairness’
Backers of the bill framed it as financial relief for homeschool families whose taxes help support the public school system but do not use it.
Jeff Pitts, speaking on behalf of the Iowa Faith and Freedom Coalition, urged lawmakers to advance the bill, framing the measure as basic fairness for homeschooling families.
Pitts told the subcommittee that homeschool parents continue to pay property and state income taxes that support public schools, even though they do not use those services. At the same time, he said, they cover the full cost of educating their children — often on a single income because one parent stays home to teach.
“We do this willingly and without complaining, because we believe in taking responsibility for our children’s education,” Pitts said. “However, providing a reasonable level of financial relief is a simple matter of fairness.”
He argued that each homeschooled student saves the state more than $8,000 in per-pupil spending, making the proposed $4,000 refundable tax credit less than half that amount.
“We aren’t asking for our fair share,” Pitts said. “We’re asking for less than half our fair share, and that seems pretty reasonable.”
Andy Conlin, representing Yes. Every Kid, said some families might prefer a smaller $4,000 tax credit over a larger ESA payment, potentially saving the state money overall. The group advocates for “education freedom, school choice, and policies that allow families to customize their children's education.”
Dustin Rush of Americans for Prosperity described the measure as another step toward what he called a “student-centered system.”
“We believe that students should have a wide buffet of options when it comes to educational (options),” Rush said. “We also believe that the dollar should follow the students to the option that their family chooses.”
Critics bemoan lack of ‘guardrails’
Critics raised concerns about the fiscal impact, oversight and the long-term effect on Iowa’s public school system.
Dave Doughton, representing School Administrators of Iowa and Rural School Advocates of Iowa, warned that public schools are funded based on enrollment.
“If we’re losing students to other areas, we’re losing enrollment and therefore losing funds — which doesn’t necessarily mean a loss or change in expenses,” Doughton said.
He also questioned whether the credit includes “guardrails” to ensure funds are spent on educational purposes.
Melissa Peterson of the Iowa State Education Association argued that if public dollars are distributed, spending accountability should follow.
Unusual opposition from 2 homeschool parents
In a notable twist, a couple of homeschool parents testified against the bill.
Lauren Gideon, a homeschool mother of seven speaking on behalf of Quadrivium Services, called the measure “a wealth redistribution program disguised as a tax credit.”
“Offering families a tax credit may sound appealing and may even feel protective to recipients but has not changed the fiscal reality that this money comes from taxpayers,” Gideon said. “Public funds should be handled with care, not handed out like candy, because every dollar represents the hard work of Iowa families.”
She rejected the argument that because homeschool families pay taxes, they are entitled to a portion of public education funding. By that logic, she said, families could claim entitlement to any publicly funded program simply because they contribute tax dollars.
For decades, Gideon said, homeschooling families have embraced independence and personal responsibility, funding their children’s education without government assistance. Accepting public funds, she warned, could invite increased oversight and future regulation.
“When public funds enter private bank accounts, they create new pathways for oversight and compliance requirements,” she said.
Gideon also raised concerns about incentives, arguing that if withdrawing a child from public school becomes the primary qualification for receiving public money, the state risks attracting “bad actors” or encouraging unintended consequences.
“Children can be the ones who suffer most,” she said, urging lawmakers to reject the proposal.
Karen Hebron, an Indianola parent who homeschools under Iowa’s independent private instruction option, echoed similar concerns.
“Freedom is more important to fairness to me, and I want to keep my freedom,” Hebron said.
Both argued that financial independence from state funding helps preserve homeschooling autonomy.
Matson: Public dollars meant to support system for all; not reimburse individual choices
Rep. Heather Matson, D-Ankeny, opposed the measure, arguing the proposal would weaken Iowa’s public education system rather than save money.
“I think it will actually continue to hurt our public schools and their ability to meet the needs of every student who walks through their doors,” she said.
Matson emphasized that she supports families’ right to homeschool, calling it an important part of school choice. However, she said she does not believe education funding should operate as an individualized free-market system. Matson pushed back on arguments that families should receive reimbursement simply because they pay taxes.
“Many taxpayers make personal choices that reduce public service usage without receiving unrestricted cash payments,” Matson said, reading from an email sent by a constituent — a former homeschooling parent — who criticized the bill for lacking income limits, spending restrictions or academic accountability requirements.
“In return, the state does not reimburse families who choose private health care, private security or private transportation,” she continued. “Public education funding is structured around maintaining a system for all children, not reimbursing individual choices, and honestly, I couldn't say it better myself.”
Rep. Samantha Fett, R-Carlisle, said an amendment was forthcoming to narrow the bill’s scope and address concerns raised during debate. Fett said the amendment would carve out what Iowa law refers to as “independent private instruction,” limiting the bill to families operating under “competent private instruction,” which carries reporting requirements.
“So the accountability argument is, to me, not an issue, because there is accountability,” Fett said. “I want to make that clear.”
Fett framed the proposal as part of Iowa’s broader commitment to school choice, saying the state has been a leader in expanding educational options and that tax credits are an important component of that effort.
Iowa has become a national leader in school choice policy in recent years, particularly after implementing universal ESAs, she said. The Opportunity Tax Credit Act would extend that expansion into the homeschool space.
“School choice in the state of Iowa is here. It’s here to stay,” Fett said. “Tax credits are a very important part of that equation. Not only does it reduce funds for the state, but it also gives more freedom.”
Comments: (319) 398-8499; tom.barton@thegazette.com
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