If you live in Maryland, you only have a few days left to apply for a tax credit to cover some of your student loans. The state is offering up to $1,000 in student debt relief tax credits, and the deadline to claim those tax credits is just two days away.
Eligible residents have until Thursday to submit the documents, after which the state will close the application portal.
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How to Claim Maryland Tax Credits for Student Loan Relief
The Maryland Student Loan Debt Relief Tax Credit Program has been in existence since 2017. The program provides an income tax credit to residents who make loan payments from a college or university. an accredited university. Over 40,000 people have benefited and more than $40 million has been distributed since the program began.
About 9,155 residents received the tax credit last year. In 2021, people who attended in-state institutions received about $1,067 in financial aid, while those who attended out-of-state institutions received $875.
Central Scholarship.org notes that no fixed amount for the per capita tax credit has been released, but most people receive around $1,000,
For the 2022 tax year, residents of Maryland have until September 15 to claim the credit. To apply for the Maryland Student Loan Relief Tax Credit, applicants should visit the Maryland Higher Education Commission (MHEC) website. Once a resident submits their application, the department will review it and notify them accordingly via email.
Who is eligible for student loan debt relief tax credits?
To be eligible for the student debt relief tax credit, residents must have a minimum of $20,000 in student debt and have at least $5,000 in student debt outstanding at the time of request.
Additionally, residents must claim Maryland residency on their 2022 tax return and file their 2022 Maryland state income taxes.
Those who did not attend a public school may also be eligible for the credit, but may get a smaller credit than those who attended a public school. Even those who applied for President Joe Biden’s student loan forgiveness program can apply for the Maryland Student Loan Debt Relief Tax Credits.
The state will prioritize applications based on a number of factors, including debt-to-income ratios, whether the applicant is a graduate of a Maryland university, whether or not they have previously received college credit. tax and if eligible for in-state tuition.
Applicants who receive credit may be asked to show proof that they have paid the amount of credit they received to their lender. Otherwise, they may be required to repay the credit amount.
To learn more about student debt relief tax credits, click here.