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1 STATE OF OKLAHOMA
1
2 2nd Session of the 60th Legislature (2026)
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3 SENATE BILL 1391 By: Jech
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4
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5
5
6 AS INTRODUCED
6
7 An Act relating to income tax credit; amending
7 Section 2, Chapter 278, O.S.L. 2023, as last amended
8 by Section 2, Chapter 295, O.S.L. 2025 (70 O.S. Supp.
8 2025, Section 28-101), which relates to the Oklahoma
9 Parental Choice Tax Credit Act; modifying income
9 limitations for certain fiscal years; modifying
10 income limitation to receive priority consideration
10 for certain school years; requiring participating
11 private school to administer certain assessments to
11 certain students; updating statutory language; and
12 providing an effective date.
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13
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14
14
15 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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16 SECTION 1. AMENDATORY Section 2, Chapter 278, O.S.L.
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17 2023, as last amended by Section 2, Chapter 295, O.S.L. 2025 (70
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18 O.S. Supp. 2025, Section 28-101), is amended to read as follows:
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19 Section 28-101. A. As used in the Oklahoma Parental Choice Tax
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20 Credit Act:
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21 1. "Accrediting association" means a recognized legal entity
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22 that meets the accreditation requirements set by the State Board of
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23 Education, another accrediting association approved by the State
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24 Board of Education, or a legal entity that accredits education
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1 organizations in multiple states, whose purpose is to verify that an
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2 education program meets or exceeds predetermined criteria, and
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3 monitor the education organization during the time it is accredited
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4 by completing regular reevaluations and on-site inspections of the
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5 education program;
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6 2. "Commission" means the Oklahoma Tax Commission;
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7 3. "Curriculum" means a complete course of study for a
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8 particular content area or grade level;
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9 4. "Department" means the State Department of Education;
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10 5. "Education service provider" means a person, business,
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11 public school district, public charter school, magnet school, or
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12 organization that provides educational goods and/or or services to
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13 eligible students in this state;
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14 6. "Eligible student" means a resident of this state who is
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15 eligible to enroll in a public school in this state. Eligible
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16 student shall include a student who is enrolled in and attends or is
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17 expected to enroll in a private school in this state accredited by
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18 the State Board of Education or another accrediting association or a
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19 student who is educated pursuant to the other means of education
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20 exception provided for in subsection A of Section 10-105 of this
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21 title;
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22 7. "Qualified expense" for the purpose of claiming the credit
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23 authorized by paragraph 1 of subsection C of this section means
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24 tuition and fees at a private school in this state accredited by the
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1 State Board of Education or another accrediting association. Such
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2 private school shall comply with the provisions of subsection L of
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3 this section. Provided, the amount of tuition and fees considered a
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4 qualified expense pursuant to this paragraph shall not include
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5 tuition and fees paid with any scholarship or tuition and fees
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6 discounted or otherwise reduced by the school;
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7 8. "Qualified expense" for the purpose of claiming the credit
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8 authorized by paragraph 2 of subsection C of this section means the
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9 following expenditures:
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10 a. tuition and fees for nonpublic learning programs,
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11 online or in person,
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12 b. academic tutoring services provided by an individual
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13 or a private academic tutoring facility,
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14 c. textbooks, curriculum, or other instructional
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15 materials including, but not limited to, supplemental
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16 materials or associated online instruction required by
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17 an education service provider, and
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18 d. fees for nationally standardized assessments
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19 including, but not limited to, assessments used to
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20 determine college admission and advanced placement
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21 examinations as well as tuition and fees for tutoring
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22 or preparatory courses for the assessments; and
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1 9. "Taxpayer" means a biological or adoptive parent,
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2 grandparent, aunt, uncle, legal guardian, custodian, or other person
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3 with legal authority to act on behalf of an eligible student.
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4 B. There is hereby created the Oklahoma Parental Choice Tax
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5 Credit Program to provide an income tax credit to a taxpayer for
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6 qualified expenses to support the education of eligible students in
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7 this state.
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8 C. For the tax year 2024 and subsequent tax years, and fiscal
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9 year 2026 and subsequent fiscal years, there shall be allowed
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10 against the tax imposed by Section 2355 of Title 68 of the Oklahoma
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11 Statutes a credit for any Oklahoma taxpayer who incurs a qualified
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12 expense on behalf of an eligible student, to be administered subject
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13 to the following amounts:
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14 1. If the eligible student attends a private school in this
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15 state accredited by the State Board of Education or another
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16 accrediting association, the annual maximum credit amount for tax
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17 year 2024, fiscal year 2026, and each subsequent fiscal year shall
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18 be:
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19 a. Seven Thousand Five Hundred Dollars ($7,500.00) or the
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20 amount of tuition and fees for the private school,
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21 whichever is less, if the combined adjusted gross
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22 income of the parents or legal guardians of the
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23 eligible student during the second preceding tax year
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1 does not exceed Seventy-five Thousand Dollars
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2 ($75,000.00),
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3 b. Seven Thousand Dollars ($7,000.00) or the amount of
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4 tuition and fees for the private school, whichever is
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5 less, if the combined adjusted gross income of the
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6 parents or legal guardians of the eligible student
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7 during the second preceding tax year is more than
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8 Seventy-five Thousand Dollars ($75,000.00) but does
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9 not exceed One Hundred Fifty Thousand Dollars
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10 ($150,000.00),
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11 c. for tax years 2024 and 2025 and for fiscal years 2026
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12 and 2027, Six Thousand Five Hundred Dollars
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13 ($6,500.00) or the amount of tuition and fees for the
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14 private school, whichever is less, if the combined
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15 adjusted gross income of the parents or legal
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16 guardians of the eligible student during the second
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17 preceding tax year is more than One Hundred Fifty
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18 Thousand Dollars ($150,000.00) but does not exceed Two
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19 Hundred Twenty-five Thousand Dollars ($225,000.00),
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20 d. for tax years 2024 and 2025 and for fiscal years 2026
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21 and 2027, Six Thousand Dollars ($6,000.00) or the
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22 amount of tuition and fees for the private school,
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23 whichever is less, if the combined adjusted gross
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24 income of the parents or legal guardians of the
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1 eligible student during the second preceding tax year
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2 is more than Two Hundred Twenty-five Thousand Dollars
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3 ($225,000.00) but does not exceed Two Hundred Fifty
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4 Thousand Dollars ($250,000.00), or
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5 e. for tax years 2024 and 2025 and for fiscal years 2026
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6 and 2027, Five Thousand Dollars ($5,000.00) or the
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7 amount of tuition and fees for the private school,
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8 whichever is less, if the combined adjusted gross
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9 income of the parents or legal guardians of the
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10 eligible student during the second preceding tax year
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11 is more than Two Hundred Fifty Thousand Dollars
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12 ($250,000.00);
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13 2. For tax year 2024 and subsequent tax years, the maximum
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14 credit amount shall be One Thousand Dollars ($1,000.00) in qualified
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15 expenses per eligible student in each tax year if the eligible
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16 student is educated pursuant to the other means of education
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17 exception provided for in subsection A of Section 10-105 of this
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18 title. To claim the credit, the taxpayer shall submit to the
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19 Commission receipts for qualified expenses as defined by paragraph 8
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20 of subsection A of this section;
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21 3. If the eligible student attends a private school in this
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22 state, accredited by the State Board of Education or another
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23 accrediting association, that exclusively serves students
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24 experiencing homelessness, the credit amount shall be Seven Thousand
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1 Five Hundred Dollars ($7,500.00) or the amount of the cost to
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2 educate the eligible student at the private school, whichever is
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3 less;
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4 4. If the eligible student attends a private school in this
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5 state, accredited by the State Board of Education or another
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6 accrediting association, that primarily serves financially
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7 disadvantaged students, the credit amount shall be the maximum
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8 credit amount authorized by paragraph 1 of this subsection or the
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9 amount of the cost to educate the eligible student at the private
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10 school, whichever is less. The cost to educate the eligible student
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11 shall be equal to the average cost to educate all students attending
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12 the private school, which shall be calculated by dividing the
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13 private school's total expenditures in the previous year by the
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14 total enrollment in the previous school year. A private school
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15 shall be deemed to be primarily serving financially disadvantaged
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16 students if ninety percent (90%) of the private school's admissions
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17 are based on enrolling students whose gross family income is two
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18 hundred fifty percent (250%) of the federal poverty threshold or
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19 below;
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20 5. The taxpayer shall retain all receipts of qualified expenses
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21 as proof of the amounts paid each tax year the credit is claimed and
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22 shall submit them to the Commission upon request;
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1 6. If the credit exceeds the tax imposed by Section 2355 of
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2 Title 68 of the Oklahoma Statutes, the excess amount shall be
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3 refunded to the taxpayer; and
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4 7. Credits claimed by a taxpayer pursuant to the provisions of
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5 this section shall not be used to offset or pay the following:
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6 a. delinquent tax liability,
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7 b. accrued penalty or interest from the failure to file a
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8 report or return,
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9 c. accrued penalty or interest from the failure to pay a
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10 state tax within the statutory period allowed for its
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11 payment,
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12 d. tax liability of the taxpayer from any prior tax year,
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13 or
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14 e. any debt, unpaid fine, final judgment, or claim filed
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15 with the Commission by a qualified entity as defined
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16 in Section 205.2 of Title 68 of the Oklahoma Statutes.
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17 D. 1. a. For tax year 2024, the total amount of credits
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18 authorized by paragraph 1 of subsection C of this
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19 section shall not exceed One Hundred Fifty Million
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20 Dollars ($150,000,000.00).
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21 b. For the period of January 1, 2025, through June 30,
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22 2025, the total amount of credits authorized by
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23 paragraph 1 of subsection C of this section shall not
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24 exceed One Hundred Million Dollars ($100,000,000.00).
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1 The Commission shall not require a taxpayer who
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2 received a credit pursuant to paragraph 1 of
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3 subsection C of this section in tax year 2024 to
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4 reapply for a credit payable during the period
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5 described in this subparagraph. The Commission shall
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6 base the credit amount payable for the spring 2025 on
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7 the fall 2024 installment disbursement payment amount.
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8 c. For fiscal year 2026 and subsequent fiscal years, the
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9 total amount of credits authorized by paragraph 1 of
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10 subsection C of this section shall not exceed Two
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11 Hundred Fifty Million Dollars ($250,000,000.00).
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12 2. For tax year 2026 and subsequent tax years, the total amount
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13 of credits authorized by paragraph 2 of subsection C of this section
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14 shall not exceed Five Million Dollars ($5,000,000.00). The Oklahoma
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15 Tax Commission shall annually calculate and publish a percentage by
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16 which the credits authorized by this section shall be reduced so the
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17 total amount of credits used to offset tax does not exceed the
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18 annual limit. The formula to be used for the percentage adjustment
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19 shall be Five Million Dollars ($5,000,000.00) divided by the amount
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20 of credit claimed in the second preceding tax year. In the event
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21 the total tax credits authorized by this section exceed the annual
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22 limit in any tax year, the Tax Commission shall permit any excess
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23 but shall factor such excess into the percentage adjustment formula
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24 for subsequent tax years.
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1 3. If a taxpayer, on behalf of an eligible student in the
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2 program, chooses not to participate, is no longer eligible to
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3 participate, or chooses to forgo participation in the program for
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4 any reason, the credit authorized by paragraph 1 of subsection C of
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5 this section but not used and not reallocated pursuant to paragraph
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6 3 of subsection H of this section shall be added to the subsequent
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7 fiscal year limitation as provided in paragraph 1 of this
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8 subsection.
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9 E. The Commission shall prescribe applications for the purposes
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10 of claiming the credits authorized by the Oklahoma Parental Choice
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11 Tax Credit Act and a deadline by which applications shall be
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12 submitted. A taxpayer claiming the credit authorized by paragraph 1
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13 of subsection C of this section shall submit an application
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14 prescribed by the Commission to receive the credit based on the
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15 enrollment verification form submitted pursuant to this subsection,
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16 but in no event shall a payment exceed the amount of the credit
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17 authorized by paragraph 1 of subsection C of this section. If an
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18 eligible taxpayer provides documentation on the application that he
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19 or she is a recipient of income-based government benefits including
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20 the Supplemental Nutrition Assistance Program (SNAP), Temporary
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21 Assistance for Needy Families (TANF), or the Oklahoma Medicaid
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22 Program commonly known as SoonerCare, the eligible taxpayer shall
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23 not be required to provide additional income verification. The
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24 Department of Human Services and the Oklahoma Health Care Authority
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1 shall, upon request by the Oklahoma Tax Commission, verify whether
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2 an applicant receives income-based government benefits. The
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3 taxpayer shall provide authorization for the Oklahoma Tax Commission
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4 to disclose application data to the Department of Human Services
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5 and/or or the Oklahoma Health Care Authority, and for the Department
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6 of Human Services and/or or the Oklahoma Health Care Authority to
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7 provide confirmation of benefits to the Oklahoma Tax Commission for
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8 purposes of verifying that the taxpayer is a current recipient of
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9 SNAP, TANF, or Oklahoma Medicaid Program benefits; provided, the
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10 information shall not be used for any other purpose. A taxpayer
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11 claiming the credit authorized by paragraph 1 of subsection C of
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12 this section shall submit to the Commission an enrollment
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13 verification form from the private school in which the eligible
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14 student is enrolled or is expected to enroll with the tuition and
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15 fees to be charged the taxpayer for the applicable school year. In
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16 reviewing applications submitted by eligible taxpayers to determine
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17 whether they qualify for a credit authorized by paragraph 1 of
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18 subsection C of this section, the Commission shall give first
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19 preference in making payments to taxpayers who qualify pursuant to
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20 subparagraphs a and b of paragraph 1 of subsection C of this
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21 section. The Commission shall give second preference in making
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22 payments to taxpayers who qualify and have received the credit in
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23 the prior year. For credits issued in the 2026-2027 school year and
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24 subsequent school years, the application period shall be open March
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1 15 through June 15 prior to the beginning of each school year. For
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2 any eligible student whose parents or legal guardians have a
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3 combined adjusted gross income that does not exceed One Hundred
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4 Fifty Thousand Dollars ($150,000.00), for school year 2026-2027, and
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5 Seventy-five Thousand Dollars ($75,000.00), for school year 2027-
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6 2028 and subsequent school years, or qualified and received credit
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7 in the prior year, applications shall be submitted to the Commission
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8 within the first sixty (60) days of the opening of the application
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9 period to receive priority consideration. For students enrolled in
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10 the full school year, the full credit amount authorized for the
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11 school year shall be paid no later than August 30.
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12 F. Taxpayers claiming the credit shall:
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13 1. Only claim the credit for qualified expenses as defined in
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14 paragraphs 7 and 8 of subsection A of this section to provide an
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15 education for an eligible student;
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16 2. Ensure no other person is claiming a credit for the eligible
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17 student;
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18 3. Not claim the credit for an eligible student who enrolls as
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19 a full-time student in a public school district, public charter
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20 school, public virtual charter school, or magnet school;
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21 4. Comply with rules and requirements established by the
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22 Commission for administration of the Oklahoma Parental Choice Tax
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23 Credit Program; and
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1 5. Notify the Commission not later than thirty (30) days after
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2 the date on which the eligible student:
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3 a. enrolls in a public school, including an open-
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4 enrollment charter school,
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5 b. enrolls in a nonaccredited private school,
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6 c. graduates from high school, or
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7 d. is no longer utilizing credits authorized by paragraph
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8 1 of subsection C of this section for any reason.
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9 G. Eligible students may accept a scholarship from the Lindsey
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10 Nicole Henry Scholarships for Students with Disabilities Program
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11 created by Section 13-101.2 of this title while participating in the
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12 Oklahoma Parental Choice Tax Credit Program.
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13 H. 1. The Commission shall have the authority to conduct an
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14 audit or contract for the auditing of receipts for qualified
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15 expenses submitted pursuant to paragraph 2 of subsection C of this
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16 section.
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17 2. The Commission shall be authorized to recapture the credits
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18 otherwise authorized by the provisions of the Oklahoma Parental
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19 Choice Tax Credit Act on a prorated basis if an audit conducted
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20 pursuant to this subsection shows that the credit was claimed for
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21 expenditures that were not qualified expenses or it finds that the
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22 taxpayer has claimed an eligible student who no longer attends a
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23 private school or has enrolled in a public school in the state.
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1 3. The Commission shall be authorized to reallocate credits for
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2 the current application year to the next eligible taxpayer in line
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3 when a taxpayer, on behalf of an eligible student in the program,
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4 chooses not to participate, is no longer eligible to participate, or
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5 chooses to forgo participation in the program for any reason no
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6 later than September 1 following the opening of the application
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7 period of each year.
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8 4. The Commission shall provide notification of approval status
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9 to applicants within thirty (30) days of closure of the application
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10 window. Notice to applicants with an eligible student, whose
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11 parents or legal guardians have a combined adjusted gross income of
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12 more than One Hundred Fifty Thousand Dollars ($150,000.00), for
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13 school year 2026-2027, and Seventy-five Thousand Dollars
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14 ($75,000.00), for school year 2027-2028 and subsequent school years,
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15 shall be sent within thirty (30) days or no later than thirty (30)
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16 days after the last day of the priority consideration period.
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17 I. In the event of a failure of revenue pursuant to the
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18 Oklahoma State Finance Act, the tax credits otherwise authorized in
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19 subsection C of this section shall be reduced proportionately to the
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20 reduction in the amount of money appropriated to the State Board of
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21 Education for the financial support of public schools for the fiscal
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22 year in which the failure of revenue occurs.
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23 J. The Commission shall make available on its website to be
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24 updated monthly:
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1 1. The total amount of credits claimed each year pursuant to
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2 paragraphs 1 through 4 of subsection C of this section;
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3 2. The amount of credits claimed and number of students awarded
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4 each fiscal year pursuant to paragraph 1 of subsection C of this
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5 section disaggregated by income categories;
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6 3. The total amount of credits claimed and number of students
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7 awarded who attended a public school in the semester immediately
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8 preceding the school year for which the application is made each
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9 year; and
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10 4. The total number of applications denied and total amount of
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11 credits the denied applications represent for each fiscal year.
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12 K. Credits received pursuant to the Oklahoma Parental Choice
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13 Tax Credit Act shall not constitute taxable income to a taxpayer who
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14 received the credit on behalf of an eligible student.
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15 L. No later than June 15 of each year, each participating
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16 private school shall electronically provide information to confirm
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17 student enrollment and tuition information for the fall and spring
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18 semesters of the preceding school year and any other information
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19 requested by the Oklahoma Tax Commission. Failure to provide this
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20 information may result in denial of private school participation in
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21 subsequent school years.
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22 M. An eligible and participating private school as of April 15,
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23 2025, shall have until March 1, 2027, to meet the accreditation
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24 requirements of this section.
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1 N. For the 2027-2028 school year and subsequent school years,
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2 each participating private school shall administer the assessments
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3 required by subsection E of Section 1210.508 of this title to
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4 eligible students for whom a taxpayer has successfully claimed tax
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5 credits pursuant to this section. Failure to comply with the
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6 provisions of this subsection shall result in denial of private
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7 school participation in subsequent school years.
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8 SECTION 2. This act shall become effective November 1, 2026.
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Req. No. 2742 Page 16Every fact on this page links to its source, starting with the official bill record.