This bill creates a new federal tax credit to encourage donations to nonprofit scholarship organizations that help lower-income students pay for K-12 education. Here's how it works: If you donate money to a qualified scholarship organization, you can claim a tax credit (a dollar-for-dollar reduction in taxes owed) for that donation. Individuals can claim a credit up to either 10% of their adjusted gross income or $5,000, whichever is greater. Corporations can claim a credit up to 5% of their taxable income. The scholarships can only go to students from households earning no more than 300% of the area median income, and the money can be used for tuition, books, tutoring, test fees, and educational therapies at public, private, or religious schools—including homeschooling expenses. To prevent abuse, scholarship organizations must meet strict requirements: they need annual audits, can't give scholarships to people connected to the organization, must distribute nearly all donations within a reasonable timeframe, and must verify that students actually qualify based on income. The bill also protects religious schools and parental choice by prohibiting government from controlling how scholarship organizations operate or from excluding religious schools from participating. There's a $10 billion annual cap on how much in donations can receive the credit, allocated on a first-come, first-served basis, with the cap automatically increasing by 5% if 90% or more gets used in a year.