There's good news for Maryland residents who have incurred at least $20,000 in undergraduate and/or graduate student loan debt: you may be eligible for a Maryland tax credit.
To be eligible for the Student Loan Debt Relief Tax Credit, you must:
Maintain Maryland residency for the 2023 tax year;
Have incurred at least $20,000 in undergraduate and/or graduate student loan debt;
Have at least $5,000 in outstanding student loan debt remaining when applying for the tax credit;
Have completed and submitted an application to the Maryland Higher Education Commission by September 15, 2023; and
Have submitted all required graduate and/or undergraduate student loan information, including Maryland income tax information and college transcripts
The amount of credit awarded is based on several factors including the type of institution you attended and the number of applicants. Priority is given to applicants who have not received the credit in the past. This past year more than 9,300 Maryland residents received the tax credit in the amount of $966 each, totaling $8,996,358 in tax credits statewide.
With that money saved on your Maryland taxes, you must use the credited amount to pay down your student loan debts in either a one-time payment or through monthly payments within three years after the credit has been awarded.
To apply, you must submit an application to the Maryland Higher Education Commission by September 15, 2023. Note that you must include a copy of your undergraduate and/or graduate transcripts for the loan years in which you incurred the debts.
There's a list of frequently asked questions here. Contact us here or call 800.899.4623.
Editor's note: this article was updated with new information in September 2023.