Last updated: 2026-11-01
Texas Education Freedom Accounts for Children with Disabilities
Texas created Education Freedom Accounts (TEFA) in 2025, giving families with special needs children up to $30,000 per year for private school, therapies, tutoring, and other approved educational expenses. Children with disabilities receive top priority in the funding lottery.
Clinically reviewed by Meaghan Timko, MS, BCBA, LBA BACB certification #1-05-2608
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What is the Texas ESA program for special needs families?
The Texas Education Freedom Account (TEFA) program is a state Education Savings Account created by Senate Bill 2 during the 89th Texas Legislature (2025). It gives families who opt out of public school an account they can use to pay for approved educational expenses, including private school tuition, tutoring, and educational therapies. For children with disabilities who have an Individualized Education Program (IEP) on file with the Texas Education Agency, the annual award is up to $30,000, nearly three times the standard amount. These children also receive the highest priority in the funding lottery.
Official TEFA site: educationfreedom.texas.gov → Join the 2027-28 interest list →
2026-27 applications are closed. More than 100,000 students have been awarded.
The application window for the 2026-27 school year ran February 4 through March 31, 2026. If you missed it, sign up for the 2027-28 interest list at the official program site so you receive the next opening notification. Accepted families automatically continue each year without reapplying.
More than 18% of participating students have a qualifying disability, according to the program's October 1, 2026 participant report. On October 26 the Texas Comptroller announced a public TEFA data dashboard and an independent third-party audit of the program.
The disability advantage: up to $30,000 and the highest lottery priority
TEFA favors families with the greatest educational needs. Children with disabilities receive both a larger award and a higher position in the priority queue than any other applicant group. The program matters most to Texas families whose children attend private special needs schools or need therapy beyond what public school provides.
Demand far outstripped supply in the first year. More than 274,000 students applied for a program initially sized near 90,000 funded seats, so the lottery decided who was accepted (Texas Comptroller). With that many more applicants than seats, the disability tier's place at the top of the priority order decides which families the Comptroller funds first.
Students with disabilities + IEP
Children with an IEP on file with the Texas Education Agency at the time of application may receive up to $30,000 per year, based on what the local school district would have received to fund their IEP services.
Standard private school students
Children without a qualifying disability who attend an approved private school receive 85% of the statewide average per-pupil funding, set at $10,474 for 2026-27.
Homeschool students
Families who homeschool or use a non-accredited microschool or learning pod receive up to $2,000 per year for approved curriculum, assessments, tutoring, and other expenses.
Priority order in the funding lottery
When demand exceeds available funding, the Texas Comptroller awards accounts in this order. Special needs families are at the top:
- 1
Children with disabilities in households at or below 500% of the federal poverty level
For a family of four, 500% FPL is roughly $240,000 or less in annual income. Most special needs families qualify at this tier.
- 2
Children in households at or below 200% FPL (roughly $60,000 for a family of four)
- 3
Children between 200% and 500% FPL (roughly $60,000 to $240,000 for a family of four)
- 4
Children above 500% FPL (capped at 20% of total program funds)
Source: Texas Education Freedom Accounts: official program site
IEP vs. proof-of-disability form: To be considered for the enhanced award of up to $30,000, your child's IEP must be on file with the Texas Education Agency at the time the application window closes. Children who submit a program-approved proof-of-disability form (without an IEP) also receive disability-tier priority but are eligible only for the standard $10,474 award, not the enhanced amount. If your child has an IEP in your school district, ask the school system whether TEA has the record needed for the application.
How TEA received IEPs in 2026-27: TEA directed school systems to report existing IEP data or upload an IEP through APEX-ESA when needed. For a child previously enrolled in public school, an IEP from the current or two preceding school years could suffice if the child had not been exited from special education. A child without a qualifying IEP could request a district evaluation; if eligible, the district would develop and upload an IEP or EFA IEP. These were first-cycle instructions, so confirm the next application cycle's requirements with TEA and your school system. Read TEA's January 29, 2026 guidance.
Who qualifies for a Texas Education Freedom Account
Eligibility is broad but has specific requirements. The child must meet all of the following:
Required qualifications
- U.S. citizen or lawfully present in the United States
- Texas resident (parent must also be a Texas resident)
- Eligible to attend a Texas public school or public pre-K program
- NOT enrolled full-time in a Texas public or open-enrollment charter school while using TEFA funds
Pre-K eligibility (narrower)
- Pre-K applicants must meet the same eligibility criteria as free public pre-K
- Child must turn 3 before September 1 of the program year
- Must fall into at least one qualifying category: economically disadvantaged, limited English, homeless, military family, DFPS conservatorship, or similar
Common reasons for ineligibility
- Could not confirm annual household income (requires Form 1040 federal tax return for 2024 or 2025; pay stubs and W-2s are not accepted)
- Could not confirm citizenship or Texas residency
- Pre-K applicant did not meet state pre-K eligibility criteria
- Application was incomplete
Once accepted
Accepted families remain in the program automatically as long as they stay in good standing. No reapplication is needed each year. Siblings of accepted children who apply during the same application period are also accepted.
What Texas Education Freedom Account funds can pay for
All purchases must be made through the Odyssey marketplace, the state-approved payment platform. Families cannot withdraw funds as cash or seek reimbursements. Purchases go directly to approved providers and vendors. For special needs families, the most relevant approved expense categories are:
- Private special needs school tuition (accredited, TEA-approved)
- Educational therapies including speech-language therapy and occupational therapy
- Tutoring and academic coaching from approved providers
- Specialized curriculum and instructional materials
- Educational assessments and evaluations
- Online learning programs from approved vendors
- Educational technology (capped at 10% of annual award)
- Career and technical education (CTE) programs
- Cash withdrawals or direct reimbursements to parents
- Purchases from vendors not approved in the Odyssey marketplace
- Services delivered by providers who have not passed state background checks
- Tuition at private schools that are not TEA-accredited and TEFA-approved
- Medical treatments (TEFA is an educational program, not health insurance)
- Public or charter school fees (child cannot be enrolled in public school during TEFA year)
The full list of approved vendors and services is maintained in the Odyssey marketplace. Before enrolling with any provider, confirm they appear in the marketplace. New providers are added on a rolling basis. Odyssey support center →
Does TEFA cover ABA therapy?
Educational and behavioral therapies are included in the approved expense categories, and ABA providers can apply for approval in the Odyssey marketplace, but you must verify that a specific ABA provider is approved before enrolling.
Therapies are an approved TEFA expense
The official TEFA rules include "therapies" as an approved educational expense alongside tutoring, instructional materials, and private school tuition. Speech-language therapy and occupational therapy are explicitly named. Applied Behavior Analysis (ABA) is a behavioral and educational intervention for autism that may qualify under the same category, provided the ABA provider has registered with the Odyssey marketplace and passed the required background checks and licensure review.
Verify your specific ABA provider in the Odyssey marketplace before enrolling
TEFA funds can only be spent with providers who are approved and listed in the Odyssey marketplace. Not every ABA provider in Texas has applied for or received marketplace approval. Before committing to a provider, confirm they appear in the marketplace and that the specific services (ABA evaluation, discrete trial training, parent training, etc.) are listed as approved line items.
Contact Odyssey support directly if you need help confirming coverage for a specific provider or service type. Odyssey support center →
TEFA does not replace STAR Kids Medicaid for ABA
Texas Medicaid added ABA as a covered benefit in February 2022. If your child is enrolled in STAR Kids Medicaid, they can access ABA through Medicaid regardless of TEFA. TEFA is an educational program and works alongside Medicaid, not instead of it. Families who hold both a TEFA account and STAR Kids Medicaid should coordinate carefully to avoid billing the same service twice.
Read the Texas ABA therapy and Medicaid guideHow to apply and the annual timeline
The 2026-27 application window has closed. Texas has not posted dates for the next window. The steps below show the first-cycle schedule as a planning reference; confirm new dates and documents on the official TEFA site.
Dates can shift, so rely on the interest list. The 2026 application window was originally set to close March 17, 2026, but a federal court order extended the deadline to March 31, 2026 (Texas Comptroller). Treat the February-through-March timing below as the usual pattern, not a guarantee.
Interest list (now open)
Interest list open nowSign up at the official TEFA site for future application notices, and check that site for the next posted deadline.
Application window
Next dates not announcedThe first window ran in February and March 2026; the next dates are not yet posted. For an enhanced disability award, ask your school system what IEP record TEA needs. Prepare the income, residency, and lawful-presence documents required by the next application guide.
Award notifications
Check Odyssey portalFunding and waitlist notifications are posted in each applicant's Odyssey portal. If demand exceeds funding, priority order determines who is accepted.
School enrollment confirmation
After award notificationFor private school students, parents indicate the school and the school confirms enrollment in the Odyssey system.
First funding deposit (25%)
First cycle: July 1, 2026Private school students receive the first 25% of their annual award on July 1. Homeschool students receive 100% at this point.
Second deposit (25%)
First cycle: October 1, 2026Private school students receive the second 25% of their award.
Final deposit (50%)
First cycle: February 1, 2027Private school students receive the remaining 50% of the annual award.
Source: Texas Education Freedom Accounts: official program timeline
Using TEFA alongside STAR Kids Medicaid
TEFA and Texas Medicaid are separate programs and a child can hold both. The difference is what each program pays for. TEFA is an educational spending account. STAR Kids Medicaid covers medical and therapeutic services including ABA therapy. Where they can work together:
TEFA pays for
- Private special needs school tuition
- Curriculum and instructional materials
- Tutoring from approved providers
- Educational therapies from marketplace-approved providers
- Assessments and educational technology
STAR Kids Medicaid pays for
- ABA therapy (evaluation + treatment, added Feb 2022)
- Medical appointments and prescriptions
- Speech, OT, and PT through Medicaid providers
- Long-term services and supports
- Service coordination through a dedicated coordinator
A child who leaves public school to use TEFA does not lose STAR Kids Medicaid eligibility. TEFA enrollment is based on educational setting; Medicaid eligibility is based on income and disability status. Confirm with your MCO that your Medicaid coverage continues when your child changes schools.
How to prepare now for the 2027-28 application
The biggest mistake families make is missing the right documentation when the application window opens. It runs for roughly eight weeks in February and March. Use this checklist to get ready.
- Ask your school system which IEP record TEA needs for the enhanced disability award and whether it has been reported or uploaded; check the next-cycle guidance
- If your child does not have an IEP, gather program-approved proof-of-disability documentation for priority placement
- Confirm your child is NOT enrolled in a Texas public or charter school during the TEFA year
- Sign up for the 2027-28 interest list at educationfreedom.texas.gov now so you receive the application opening notification
- Confirm the private school is accredited by a TEA-recognized body and appears in the TEFA finder tool
- Ask the school whether they administer the required annual assessment for grades 3-12
- For therapies and services, verify the provider is registered in the Odyssey marketplace before enrolling
- For ABA therapy specifically, contact Odyssey support to confirm it is approved under your child's account
- TEFA and STAR Kids Medicaid may be used together for different services. Confirm with your MCO what Medicaid still covers
- TEFA does not replace Medicaid eligibility; a child can hold both
- The Children's Autism Program (CAP) is a separate state program and is not part of TEFA
- Confirm with your school and Odyssey which services are billed through TEFA vs. Medicaid to avoid double-billing
A new federal option is scheduled to start January 1, 2027. Texas is one of the 27 states the IRS listed in June 2026 as participating in the federal scholarship tax credit, which gives taxpayers a federal credit of up to $1,700 for donations to a scholarship granting organization (SGO) in a participating state. SGOs turn those donations into K-12 scholarships for students in households earning no more than 300% of area median income, and families can use them for private school tuition, tutoring, and other education costs. The federal credit is separate from TEFA. Watch for Texas SGOs to announce how families apply for 2027 scholarships.
On October 1, 2026, Treasury and the IRS announced proposed Section 25F regulations and companion temporary regulations. The temporary regulations were published in the Federal Register on October 2 and take effect December 1, 2026; the broader proposed regulations are not final rules. The federal credit is scheduled to begin January 1, 2027. The donor credit does not guarantee a scholarship for a family, and an SGO scholarship is separate from a TEFA award. Check current IRS and Texas SGO guidance before making plans.
We can match your child with private special needs schools and ABA providers in Texas that are pursuing or have received Odyssey marketplace approval.
Frequently Asked Questions About Texas Education Freedom Accounts
What changed in the federal scholarship tax credit rules in October 2026?
How much does a child with autism or a disability receive from TEFA?
Can TEFA funds be used for ABA therapy?
Does my child lose Medicaid if we use TEFA?
The 2026-27 window is closed. What can I do now?
Is TEFA a voucher program?
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