Sioux Falls Launches Tax-Credit Scholarship Fund

Eligible students from families below 300% of the federal poverty level could receive scholarships once contributions begin in 2027.

Updated on Nov. 12, 2026 in Scholarships

Sioux Falls Launches Tax-Credit Scholarship Fund

Live Poll

Would you direct part of your federal taxes to local student scholarships?

The Sioux Falls School Board has approved creation of the SFSD Tax Credit Scholarship Fund, which will provide scholarships to eligible students, with contributions scheduled to begin January 1, 2027.

Why it matters

The fund lets residents direct tax dollars toward scholarships for local students, a federal tax-credit option the state opted into last year. Scholarship money would reach students who qualify under family-income rules for the first time through this local vehicle.

Individuals can give up to $1,700 a year and married couples up to $3,400, with contributions beginning January 1, 2027. Students from families with incomes below 300% of the federal poverty level can qualify for assistance.

The players

Sioux Falls School District (SFSD)

The largest school district in South Dakota, serving Sioux Falls students and now administering the local tax credit scholarship fund.

Robert Sittig

A former Baltic school superintendent who will serve as the program coordinator for the SFSD Tax Credit Scholarship Fund.

Larry Rhoden

South Dakota's governor, who announced last year that the state would take part in the federal scholarship tax credit program.

The details

Contributors can give through automatic payroll withdrawals or when paying federal income taxes. The fund will educate potential contributors, verify student eligibility, and comply with rules set by the U.S. Department of the Treasury and the Internal Revenue Service. The district plans to allow employees to contribute through payroll deductions. Scholarships are likely not to be awarded until next fall, when the new school year begins, and the initial focus will be on recruiting contributors and building the fund.

Last year (2025): Governor Larry Rhoden announced South Dakota's participation in the federal program.
Week of November 11, 2026: The Sioux Falls School Board approved the scholarship fund.
January 1, 2027: Contributions are scheduled to begin.
Fall 2027: Scholarships are likely to be awarded at the start of the new school year.

Education Landscape

The fund is built on the federal scholarship tax credit enacted in the "One Big Beautiful Bill" signed by President Donald Trump, which lets donors receive tax credits for supporting private scholarships. Sioux Falls is among the first places in South Dakota to turn that federal option into a local scholarship program.

If your family's income falls below 300% of the federal poverty level, the new fund may offer scholarship assistance starting next fall. Ask the Sioux Falls School District about eligibility and how to apply once applications open.

The takeaway

Local scholarship funding built on a federal tax credit could give Sioux Falls families new support starting next fall. Watch for announcements from the district about contribution details and how eligibility will be verified before the first awards are made.