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North Carolina
North Carolina

August 5, 2013

Tax Credit Repealed, Scholarship Created for Children with Disabilities

Senior Counsel Dee Black answers questions and assists members with legal issues in North Carolina. He and his wife homeschooled their children. Read more >>

On July 29, 2013, the governor of North Carolina signed into law House Bill 269, which repealed the tax credit for children with disabilities and instead created scholarship grants to fund services for these children in a nonpublic school setting, including homeschools. In order to be eligible for a scholarship, the student must be under the age of 22 and meet the following criteria:

  1. Requires an Individualized Education Plan;
  2. Receives special education or related services on a daily basis;
  3. Has not been placed in a nonpublic school or facility by a public agency at public expense;
  4. Has not spent any time enrolled in a postsecondary institution as a full-time student taking at least 12 hours of academic credit;
  5. Has not received a high school diploma; and
  6. Meets at least one of the following requirements:
    1. Was enrolled in a North Carolina public school during the previous semester;
    2. Received special education or related services through the North Carolina public schools as a preschool child with a disability during the previous semester;
    3. Received a scholarship grant for the previous semester; or
    4. Is eligible for initial enrollment in kindergarten or the first grade in a North Carolina public school.

Scholarship grants are for not more than $3,000 per semester per eligible student. Funds may be used only for the reimbursement of tuition and special education and related services, including those services provided to homeschool students. Parents may only receive reimbursement for related services provided to homeschooled students if the parent provides documentation that the student received services for no less than 75 days of the semester for which the parent seeks reimbursement. Students must be reevaluated at least every three years by the local education agency to verify that the student continues to be a child with a disability.

The new law applies beginning with the spring semester of the 2013-2014 school year. Application for the scholarships must be made with the North Carolina State Education Assistance Authority for the 2014 spring semester by October 1, 2013.

Because of the eligibility requirements, most families currently homeschooling do not qualify for a scholarship. On the other hand, the new law encourages parents with a special needs child in public school to withdraw their child and begin homeschooling, knowing that the scholarship will provide funds for needed services.

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