Maryland Offers Student Loan Debt Relief

You may be eligible to receive a Maryland Income tax credit of up to $5,000 if you have qualifying undergraduate student loan debt and are a Maryland resident thanks to a tax credit program offered by the Maryland Higher Education Commission (MHEC). Here is what you need to know:

What is qualifying debt?

1) Original debt must have been at least $20,000 and used to pay for undergraduate education
2) $5,000 must still be outstanding

How do you apply for the credit?

1) Complete and submit an application to the Maryland Higher Education Commission by September 15th of the tax year for which you are applying
2) Proof of the loan, an official copy of your college transcript, and a copy of your most recent Maryland tax return must be submitted with the application

Also, the credit is for students with debt in their name. Parents with student loan debt on behalf of their children are not eligible for the credit.

How much credit can you get?

1) The maximum credit an individual can get is $5,000
2) The MHEC has a $5M pool of funds so the credits may be limited depending on how many people apply
3) The MHEC will prioritize tax credits based on the following:

    1. a. Debt to income ratios
      b. Alumnus of a college located in Maryland
      c. How much credit was award in a prior year
      d. State tuition eligibility

The due date for 2018 applications is September 15, 2018 so make sure to act fast to take advantage of this opportunity. If you have any questions please contact your KatzAbosch representative or call 410.828.2727.

News, Tips & Insights Sign-Up to Receive Updates

Enter your email address to subscribe to our digest of accounting and firm news.

  • This field is for validation purposes and should be left unchanged.