RAISE Act of 2025

Key Points

• Creates a new refundable federal tax credit for teachers and early childhood educators: $1,000, with extra credit for those working in higher-poverty schools.
• The extra credit is tied to how high a school’s student poverty rate is, up to an added $14,000 (or $9,000 for some early childhood educators without a bachelor’s degree).
• Raises the existing teacher classroom-supply deduction from $250 to $500 and expands it to cover early childhood educators who work enough hours.
• Requires states, school districts, and early-childhood program funders not to cut teacher pay or loan forgiveness just because educators qualify for this federal tax break.
• Sets mandatory federal funding for grants to school districts that maintain or increase teacher salary schedules, with $5.2 billion for fiscal year 2026 and annual increases tied to inflation after that.