ESA approved expenses 2026-27: what your funds cover (and what they don't)

Published July 9, 2026

What are ESAs, and where are they available?

Education Savings Accounts (ESAs) are state-run programs that give families access to public education funds for private educational use. Rather than assigning dollars directly to a school, ESA programs allocate funds to families to spend on approved services and materials — giving parents direct control over how their child's education dollars are used.

As of 2026, more than 30 states have enacted some form of school choice program, with ESAs now active across more than 20 of those states. Each program has its own eligibility criteria, funding amount, approved expense categories, and administration platform. What is covered in one state may not be covered in another.

Major 2026-27 program updates you need to know

Three significant developments this school year affect families in Texas, Alabama, and Arizona.

Texas TEFA: homeschool funds live July 1, 2026

Texas Education Freedom Accounts (TEFA) sent the single largest ESA fund event in Outschool's history on July 1, 2026 — approximately 100,000 students received their funding. Homeschool and other non-private-school families received the full $2,000 annual award deposited at once. Private school families received the first 25% installment of $10,474, with the remaining installments in October 2026 and February 2027. Families with an active IEP may receive up to $30,000. All funds are managed through the Odyssey marketplace. [1]

Alabama CHOOSE Act: funds live July 1, 2026

Alabama's CHOOSE Act launched its first full funding year on July 1, 2026. Home education students are eligible for approximately $2,000; public school students switching to a private school are eligible for approximately $7,000. Alabama uses ClassWallet as its administration platform. Outschool is confirmed on the official ALDOR Education Service Providers list as an approved vendor under "Online Education Classes/Courses." Families book Outschool classes directly through ClassWallet. [2]

Arizona ESA (Empowerment Scholarship Accounts)

Arizona's ESA program continues to be one of the most expansive in the country, covering all K-12 students in the state with an average award of approximately $7,500 per year. Arizona uses ClassWallet as its administration platform. Outschool is an approved vendor. For the most current information on Arizona program updates, refer to the Arizona Department of Education's official ESA page at ade.az.gov/esa.

Education expenses typically covered by ESAs

While the specifics vary by state, most ESA programs share a common set of eligible expense categories. Here is a general overview to help you plan.

Academic costs and curriculum

Private school tuition at an eligible institution
Online course fees for core subjects or accredited programs
Curriculum materials including textbooks, workbooks, and digital learning tools
Instructional supplies like calculators, microscopes, or science kits tied to coursework
Standardized test fees (SAT, ACT, state-recognized assessments)
Academic registration fees associated with eligible program enrollment

Support services and special education

Speech, occupational, physical, or behavioral therapy when recommended as part of a child's learning plan
Diagnostic evaluations that assess learning challenges or developmental needs
Assistive technology, including communication devices or specialized software
Paraprofessional aides or educational specialists providing homeschool support

Enrichment and extracurricular learning

Some programs cover enrichment experiences that support broader learning, creativity, or skill-building. Approval varies by state — check your program's handbook before spending in this category.

Arts, music, and language instruction when part of an educational plan
STEM programs like robotics, coding, or science labs when linked to academic development
Educational memberships, field trips, or supplemental learning tools when clearly tied to instruction

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Expenses typically not covered by ESAs

Most programs have clear exclusions for items that don't directly support learning goals. Spending on ineligible items may lead to denial or require repayment.

Recreational equipment or toys not clearly tied to academic instruction
Clothing and accessories, including school uniforms in most states
Technology without academic use, such as gaming consoles or entertainment devices
Standard household items like furniture or cleaning supplies
Unapproved service providers or platforms not on your state's vendor list
General extracurricular fees not clearly tied to instruction

How Outschool works with your ESA

How you use Outschool with ESA funds depends on which state program you are in. There are three models.

Odyssey marketplace states (TEFA — Texas)

TEFA families access Outschool directly through the Odyssey marketplace. Once your funds are in your Odyssey account, browse and enroll in Outschool classes the same way you would shop any Odyssey provider. Funds are applied directly — no out-of-pocket payment required.

ClassWallet states (Alabama CHOOSE Act, Arkansas, Idaho, Louisiana, and others)

Families in ClassWallet states book Outschool classes through their ClassWallet account. Log in to ClassWallet, search for Outschool, and use your ESA balance to enroll. You do not pay upfront.

Direct reimbursement states (Arizona, South Carolina, Georgia, and others)

Some state programs require families to pay for Outschool classes out of pocket and then submit itemized receipts for reimbursement through the program's portal. Always keep documentation of what was purchased, when, and how it supports your child's learning plan.

Outschool is currently ESA-approved in Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Idaho, Louisiana, New Hampshire, New York, North Carolina, South Carolina, Texas, Utah, West Virginia, and Wisconsin. If your state is not listed, sign up to get notified when Outschool becomes available in your program.

How to stay compliant with your state ESA program

Review your state's ESA handbook or official website before making any purchases. Some expenses require preapproval or are only eligible under certain conditions.
Stick to approved vendors or platforms. Most programs restrict purchases to a closed marketplace or specific vendor list.
Save all itemized receipts and invoices, even for purchases made through approved portals.
Stay up to date on program changes. ESA rules shift year to year.

Frequently asked questions

Can I use ESA funds for homeschooling curriculum?

In many states, yes — if the materials meet your state's educational standards or align with your learning plan. Double-check your program's approved expense list before purchasing.

How does Outschool show up as an approved vendor?

For Odyssey states (TEFA), search Outschool directly in the Odyssey marketplace. For ClassWallet states, search for Outschool in your ClassWallet account. For reimbursement states, pay upfront and submit receipts through your state's ESA portal citing the eligible expense category, typically "online educational program" or "tutoring."

What happens if I accidentally buy something not approved?

Each state handles this differently, but you may need to repay the funds or face account restrictions. Reviewing the rules ahead of time and keeping your purchases tied to academic goals helps you avoid issues.

Do ESA funds roll over from year to year?

This depends on your state. TEFA funds roll over if your child stays in the program. Alabama CHOOSE Act funds expire at the end of the school year. Check your specific program's rules.