Post-graduation scholarships are charitable grants made by foundations to attract or retain individuals with needed skills and talents to a particular region or community. Generally, a traditional scholarship given to an individual to attend an educational institution is tax-free, while a post-graduation scholarship awarded to someone who has completed a degree or technical program to help pay off a portion of their student loans is treated as taxable income, limiting the scholarship’s impact. As with traditional scholarships, these post graduation scholarship programs would establish eligibility requirements, as well as a process to verify that those requirements continue to be met through the duration of the scholarship award agreement.
The Workforce Development Through Post-Graduation Scholarship Act would treat post-graduate scholarships as non-taxable income, encouraging more graduates to bring their skills and educational training to the communities that need them most. In the 119th Congress, the Workforce Development Through Post Graduation Scholarship Act (H.R.7594) was introduced by Rep. Darin LaHood (R-IL) and Rep. Terri Sewell (D-AL). The Council appreciates the leadership of Rep. LaHood and Rep. Sewell, as well as their staff.
The Workforce Development Through Post-Graduation Scholarship Act (H.R. 7594) would:
- Define post-graduation scholarship grants as a charitable activity provided by certain tax-exempt organizations, repaying any portion of an education loan incurred by an individual.
- Exclude from an individual’s taxable income a post-graduation scholarship grant in the same manner as traditional scholarships.
- Ensure that this program is benefiting those communities most in need.
Require the Secretary of the Treasury and Comptroller General to submit to Congress reports on the implementation of this program.
The Council strongly supports allowing foundations to administer post-graduation scholarship programs by enacting the Workforce Development Post-Graduation Scholarship Act.
More Information on the Workforce Development Through Post-Graduation Scholarships Act:
- Joint Philanthropy Thank You Letter to the Congressional Leaders (Updated August 2023)
- Council Position Brief on the Workforce Development Through Post-Graduation Scholarship Act
- Legal Background on Scholarship Grantmaking by Foundations
- Council Webinar Recording: Post-Graduation Scholarships: What are they and how you use them?
