Texas Education Freedom Accounts (TEFAs): What Families Need to Know

Here at Natural Health Network we make it a top priority to keep you up to date on all things related to health and wellness including mind, body and spirit. That said, education plays a huge roll in overall health and wellness. This is why we have done the research for you on the new Texas Education Freedom Accounts and what they mean for you if you choose to apply.

In 2025 Texas enacted SB2, creating the Texas Education Freedom Accounts (TEFA) program – a new statewide voucher initiative. Under TEFAs, the state (through the Comptroller’s office) deposits an education fund for each participating child, which families can spend on approved K–12 education expenses.

For example, Comptroller materials explain that TEFA funds can cover “private school tuition, tutoring, textbooks and more, functioning like a state-managed family school savings account. By law, the program launches in the 2026–27 school year, with applications opening in early 2026.

In effect, most Texas children not in public school will eventually be able to receive roughly 85% of the per-student funding that public schools get.

TEFA money works much like a prepaid education account. Each approved student will receive roughly $10,000–$10,900 per year (about 85% of average public funding) to spend on qualified education. Families can use the funds to pay tuition at accredited private schools or to buy school supplies, curriculum, tutoring, therapy, transportation and other approved services.

For example, pencils, textbooks or tech purchases are covered as school-related items. Parents manage the account through a state-selected online platform. Importantly, children with disabilities (with a qualifying Individualized Education Program, or IEP) get additional support – up to $30,000 extra per year, based on the state’s special education. In contrast, homeschoolers and other non-private enrollees receive a flat $2,000 per year.

Who Is Eligible and How Much Funding?

Almost any Texas student K–12 can apply, as long as the child is not enrolled in a public school (you cannot “double-dip” in public and TEFA at the same time) Eligible children must be U.S. citizens or otherwise eligible to attend Texas public schools. In practice that means most Texas families qualify. A 4‑year‑old is even eligible if they meet state pre‑K criteria (e.g. income-based free pre‑K or other at-risk requirements) The statute includes no strict income cap on participation – even wealthy families can apply – though by law up to 20% of voucher slots are reserved for higher-income households.

If demand exceeds funding, the Comptroller will prioritize applicants in this order:

(1) Disabled students from low/middle‑income families (up to 500% of poverty)

(2) All families below 200% of poverty

(3) Families between 200–500% of poverty, and finally

(4) Others (up to 20% of funds)

Children leaving public schools are given priority over those already in private school. In dollar terms, an approved student’s award is about $10,300 per year (subject to budget and exact calculations) Children with disabilities (with an IEP) get an extra disability allocation so they can have up to ~$30,000 per year.

Home-schoolers and other students not enrolled in any private school receive the basic $2,000 yearly award. (If a homeschooled child also qualifies for the special needs allotment, their funding could exceed $2,000.)

Families may use the TEFA funds for a wide range of expenses: the Texas Private Schools Association notes that TEFA money can pay for things like tuition, breakfasts/lunches, uniforms, tutoring, therapies, and even computer hardware and software.

Rules for Participating Schools

Only accredited private K–12 schools may accept TEFA funds. Schools must be accredited by a recognized agency and have been in operation at least two years, whether in Texas or another state. Virtual schools must also have a Texas-based campus or office on file. Participating schools must agree to administer a nationally norm-referenced standardized exam each year (instead of the state STAAR tests) for EFA. They must also handle TEFA payments through the Odyssey account system. Other than that, the law does not impose new curricula or reporting requirements.

In fact, the final rules explicitly state that participating private schools won’t face extra state oversight beyond accreditation. For example, private schools do not have to provide IEP/504 special-education accommodations the way public schools do. They remain free to set their own admissions and curriculum policies and can refuse applicants on the same grounds they always have.

In practical terms, a private school that opts into TEFA simply must verify it is accredited and on the approved list, then register for the program and use the state’s payment portal. It does not mean the school becomes a charter or loses independence. Schools that choose not to participate can continue as usual – TEFA participation is 100% voluntary.

Under TEFA, private school classrooms may see new students whose families apply voucher funds. Participating schools will each administer their own acceptable test rather than STAAR. Otherwise, they follow the same internal rules as before – for instance, they do not need to change hiring or curriculum to participate. Most importantly, schools can still set admissions criteria, and they are not required to follow public‑school disability laws. In short, TEFA “follows the child,” but participating schools don’t have to alter their day-to-day operations except to handle the vouchers.

Homeschool Families

If you homeschool, TEFA is entirely optional – you are not forced to change your homeschool by the law. The Texas Home School Coalition (THSC) emphasizes that “homeschool freedoms stay the same” and there is no new testing or curriculum mandates for families who do not participate. Families who do choose to participate can treat the TEFA like a stipend: each approved homeschooled child gets $2,000 per year to use on qualified educational expenses (or more if the child has an IEP). They could use those funds to buy curriculum, pay for tutors or dual-credit courses, cover therapy bills, or any other approved service. Homeschoolers would manage their own program as before – but with TEFA, they simply draw on the state-provided account for payment. If you never enroll in the program, nothing changes; if you do enroll, you keep full authority over your child’s education while just having extra funds available.

Students with Special Needs

TEFA includes provisions for children with disabilities. By law, a child is considered disabled if they qualify for special education (by IDEA criteria) – essentially any child who has an IEP, or meets one of many listed disability categories. The voucher rules allow families to submit evidence of a disability when applying (such as a Social Security disability award letter or a doctor’s note) Children with an IEP automatically qualify for the full disability funding up to ~$30,000) once approved.

Importantly, the law also ensures that public districts evaluate non-public students who may qualify for the extra funds. If a parent believes their child has special needs and the child is private or homeschooled, the local school district is obligated to conduct an initial evaluation just as it would for a public student. The district must hold a special education “ARD” meeting and, if the child is found eligible, create a TEFA-specific IEP. Schools have 45 instructional days (after consent) to complete such evaluations for non‑public students. Once a TEFA participant has an IEP in the system, the Comptroller’s office will release the additional disability funds into the child’s account.

However, families should note that a private school is not required to implement all public-school IEP services or accommodations. In practice, parents often must arrange some services (tutors, speech therapy, etc.) themselves, funded through the account. As one news analysis points out, the law simply says “participating students…receive a comprehensive educational evaluation before [getting disability funds]– it does not obligate the private school to deliver an IEP. So parents of special-needs children can certainly get extra money via TEFA, but should ask any prospective school what supports they provide before enrolling.

Application Process & Timeline

Texas has set official rollout dates. Beginning Dec. 9, 2025, the Comptroller’s office will invite eligible private schools and vendors to register for the program (starting with those already in the state’s special‑education voucher program)

Then February 4, 2026, the online application for families will opencomptroller. That application window will stay open for several weeks (roughly through mid‑March) Families who apply will typically be notified by May if their child is approved, so that accounts and spending plans can be in place by the fall 2026 school year.

In practice, families should watch for notices from the Comptroller’s office in early 2026. School choice and homeschool advocacy groups (like THSC) recommend signing up for updates now. Once applications open, a parent will create a TEFA account, submit basic information about income and disability, and upload the child’s proof of residency/citizenship and (if disabled) evidence of an IEP or doctor’s evaluation. Approved families will then direct funds to their chosen accredited school or pay for approved services through the state portal. Note that a student does not have to reapply each year if they stay in good standing.

Effects on Public Schools and Taxes

Impact on Public Schools: Voucher opponents warn that TEFAs will divert state money away from school districts. The legislature has set aside roughly $1 billion for the first two years of the program. With future costs potentially climbing into the billions later. Since Texas has no statewide income tax, the education budget is largely finite. Districts serving the majority of Texas children may face tighter budgets if funding per child moves to private accounts. Critics (including state legislators) say this could contribute to school closures, staff shortages or program cuts in local public schools.

For example, at the bill’s signing one Democrat warned: “Remember this day next time a school closes… or your local property taxes rise because the state… is not doing its fair share.”

Property Taxes:

Because Texas relies heavily on local property taxes for education, any reduction in state funding could affect local tax rates. If the legislature does not replace the lost revenue, school districts might need to raise property taxes to maintain budgets. So far Texas leaders are using one-time budget surplus dollars for TEFAs, but fiscal analysts caution this is unsustainable. A Center on Budget report notes that combining massive voucher spending with recent property-tax cuts (and no income tax) puts a “perfect storm” of underfunding on the horizon. In plain terms: families themselves aren’t paying a new voucher tax, but the scheme could strain Texas finances over time. If state revenue falls, districts may have to cut programs or turn to local taxes.

Competition and Enrollment:

By law, a student can only use a TEFA if they leave the public school system. So districts will lose funding for any student who takes a voucher spot. Some charter-like effects are possible: schools that improve dramatically might attract new voucher users, while lower-performing districts could see enrollments dip. Proponents argue this competition will spur improvement; opponents fear it will leave some communities with less funding per student and thereby raise class sizes or shrink offerings.

What About Taxes?

The voucher law does not raise new taxes at this time. It reallocates existing education dollars. But families should understand the long-term implications: if TEFAs and simultaneous tax cuts continue, the state might have to cut other programs or demand higher local taxes eventually. For example, the CBPP report suggests that “when the surpluses dry up, Texas could face devastating cuts to education and local services.

In summary, there’s no immediate change in your tax rate because of SB2, but funding pressure could influence school budgets and local levies in the years ahead.

Key Takeaways for Families

• New Choice: Beginning 2026, most Texas families can choose where public education dollars go. If you enroll your child in an accredited private school (or otherwise meet criteria), the state will put ~$10,000/year into an account to spend on that child’s education. This effectively makes state funding portable.

  
  

• Eligibility: Almost any Texas K–12 student qualifies, including pre‑K if eligible for free pre‑K. Homeschooled children can participate (for $2,000/year) and keep their homeschools. Children with disabilities can get up to $30,000/year by getting an IEP from a public school evaluation.

  
  

• School Requirements: Schools that accept TEFAs must be accredited and have 2+ years in operation.They won’t have to follow public‑school rules (like STAAR or IEP laws) except that they must give students a recognized standardized test and use the state’s payment system.

  
  

• Application: Watch for the Feb. 4, 2026 window. If you apply and qualify, your account will remain active so you do not reapply every year. You’ll use the online portal to pay tuition or bills for approved services.

  
  

• Public School Impact: Taking a voucher spot means leaving public school, which can help families get desired schools but will reduce funding and enrollment in the district. Over time, districts may feel budget effects. Observers urge families to consider not only their child’s needs but also the broader community impact, since Texas schools rely on both state and local (property) funds.

  
  

For more details, watch for official guidance from the Texas Comptroller (who is overseeing TEFAs) and the Texas Education Agency. The resources linked below offer FAQs and updates. In short, TEFAs aim to empower parents with funding flexibility, but families should carefully weigh their options. If you consider enrolling in the program, start by checking which private schools are planning to participate and what services they offer (especially for special-needs students). And remember: you don’t have to participate if you’re happy homeschooling or in public school – those choices remain fully available, unchanged by this new law.

Stay Informed on Texas Education Freedom Accounts

Sign up for updates HERE.