Tennessee EFS Approved Expenses: What You Can and Can't Spend Scholarship Funds On

You've secured a Tennessee Education Freedom Scholarship — $7,530 disbursed to your child's Theodore digital account in quarterly installments. Now you need to know exactly what that money can pay for, because spending it wrong can freeze your account, trigger a repayment demand, or permanently revoke your eligibility.

The spending rules are stricter than most families expect. Tuition comes first, always. Everything else is secondary and conditional.

The Mandatory First Spend: Tuition

EFS funds are legally encumbered for private school tuition and required enrollment fees before any other category unlocks. The Theodore platform automatically locks your funds for tuition invoicing. Your enrolled private school submits an electronic invoice through the portal, you review and approve it, and the payment goes directly to the school.

Until the school confirms in the portal that your child's annual tuition is fully satisfied, you cannot spend a dollar on anything else. There's no way around this — the platform won't let you.

Approved Secondary Expenses

Once tuition is paid in full, the remaining balance (if any) unlocks for these categories:

Required textbooks and instructional materials. Must be required by the enrolled private school — not supplemental or optional materials you selected yourself.

Required school uniforms. Only if the participating school mandates a standardized dress code.

Tutoring services. The tutor or agency must be approved by TDOE. You can't hire your neighbor's college student and submit a receipt.

Computer hardware and technology devices. Laptops, tablets, and educational devices are allowable, but only if purchased through a registered private school or TDOE-approved vendor at fair market value. You can't buy a laptop from Best Buy and submit the receipt.

Educational therapies. Speech therapy, occupational therapy, and similar services delivered by licensed or TDOE-approved professionals.

Transportation. Fee-for-service transportation to and from school through TDOE-approved commercial providers. Not gas money. Not your personal car mileage.

College prep and AP exam fees. ACT, SAT, AP exam registration, and credentialing test fees.

Summer and after-school academic programs. Must be TDOE-approved academic enrichment programs — not summer camp, not recreational activities.

What's Explicitly Prohibited

Cash withdrawals or personal bank transfers. EFS funds never touch your personal bank account. Everything flows through the Theodore digital wallet.

Standalone internet service. Monthly broadband or data plans are not covered, even if your child needs internet access for schoolwork.

Unbundled software. Software purchased separately from school-approved hardware or curriculum packages is not allowed.

Independent homeschool materials. Any expenses incurred under traditional home education status (independent homeschool or Category IV umbrella school) are prohibited. EFS funds are exclusively for students enrolled in Category I, II, or III private schools.

How the Marketplace Works

For the 2026-2027 school year, TDOE scheduled the EFS Marketplace to open on October 19, 2026. Through the Theodore portal, parents can order pre-approved textbooks, uniform vouchers, technology hardware, and tutoring services directly from registered state vendors. This is the cleanest path to secondary spending — the marketplace only shows approved items, so there's no risk of an unauthorized purchase.

For approved expenses bought outside the marketplace, you submit a digital reimbursement claim through the portal with itemized receipts, proof of payment, and documentation showing the purchase was required by your school (a syllabus or fee schedule works).

What Happens to Unspent Funds

If your school's tuition is less than $7,530, the remaining balance stays in your child's digital account. Students who renew for the following year can roll the balance forward. But if your child exits the program — moves out of state, returns to public school, switches to homeschooling, or graduates — all remaining funds go back to the State Treasurer.

TDOE runs periodic and random audits of EFS accounts. Spending on unapproved items triggers a repayment demand, account freeze, and potential referral to the Attorney General. The Tennessee EFS Parent Guide includes a spending workflow that maps every expense category to the correct portal process, so you never trigger an audit flag.

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