Marylanders paying off their student loans still have time to apply for debt relief to help lessen the amount they still owe.
The deadline for the state’s Student Loan Debt Relief Tax Credit Program for Tax Year 2022 is Sept. 15.
“Going to college may seem out of reach for many Marylanders given the huge expense, but tax credits like these help make it possible. I urge everyone to apply now before time runs out,” Comptroller Peter Franchot said. “Any way to bring down the cost of higher education is a big benefit.”
The program works by providing an income tax credit for Maryland residents making eligible undergraduate and/or graduate education payments on loans from an accredited college or university. It is administered by the Maryland Higher Education Commission (MHEC).
You do not have to be a college graduate to qualify, but you must claim Maryland residency for the 2022 tax year and file 2022 Maryland state income taxes to be eligible. You also must have at least borrowed $20,000 in student loan debt and still have at least a $5,000 outstanding balance upon applying for the tax credit.
Applicants who have a higher debt burden to income ratios, graduated from a Maryland school, did not get a tax credit the year before and were eligible for in-state tuition will be prioritized. If you attended a school out of state, you are still eligible for the tax credit but may not receive as large an amount as those who went to a Maryland school.
More than 40,000 Marylanders have received the tax credit since it was introduced in 2017, and more than $40 million have been distributed through the program, a news release from the comptroller’s office said.
Some 9,000 residents received the credit in 2021, with those who went to school in-state getting more than $1,000 and $875 for out-of-state schools.
For more information on how to apply, visit the Maryland Higher Education Commission website.
On Wednesday, President Joe Biden is set to announce a move to forgive up to $10,000 in federal student loans for many Americans and extend a pause on payments to January, The Associated Press reported.
