Student Loan Debt Relief Tax Credit for Tax Year 2020 Details

last revised 07/02/20 at 2:24 pm

Student Loan Debt Relief Tax Credit for Tax Year 2020


Student Loan Debt Relief Tax Credit Application for Maryland Residents & Maryland Part-year Residents.

This application and the related instructions are for Maryland residents who wish to claim the Student Loan Debt Relief Tax Credit. The Student Loan Debt Relief Tax Credit is a program, created under § 10-740 of the Tax-General Article of the Annotated Code of Maryland, to provide an income tax credit for Maryland resident taxpayers who are making eligible undergraduate and/or graduate education loan payments on loans obtained to earn an undergraduate and/or graduate degree (i.e., associate, bachelor, masters, professional graduate, doctoral, or post-doctoral degree) from an accredited college or university. Priority is given to individuals who meet both of the following criteria: (1) they have not received the Maryland tax credit in any prior years; and (2) they incurred their loans in order to pay in-State tuition to an institution located in Maryland. Additional prioritization criteria are set forth in § 10-740 of the Tax-General Article of the Annotated Code of Maryland, and in the implementing regulations.


When to apply: From July 1, 2020 through September 15, 2020.


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Instructions

Review the steps - read carefully

  1. OneStop Platform Instructions

    I. When setting up your account, please do not enter a temporary email address such as a workplace or college email. MHEC would like permanent addresses for issuing tax credit awards and for all future correspondence from us.


    II. Entering more than one application puts you at risk of being skipped altogether. Do not abandon an application that you already started.

  2. Supporting Documentation

    The following documents are required to be included with your completed Student Loan Debt Relief Tax Credit Application:


    I. Complete transcripts from each undergraduate and/or graduate institution that you attended. Include only those that correspond to your college loan documentation. Transcripts are not required to be official.


    II. Documentation from your lenders showing the educational loans that qualify for the credit. Documentation must include lender’s name, address, and phone number; borrower’s name and account numbers; original loan balances; and current outstanding loan balances. The college loan debt information and documents must be in the name of the applicant, not the parent or other person. NOTE: Failure to provide proper lender documentation could disqualify your application. Don’t get disqualified due to incorrect lender documents. Click here to see examples of lender document “Do’s and Don’ts”.


    III. A copy of your Maryland income tax return for the most recent prior tax year. NOTE: Do not attach unnecessary pages or entire tax packets (ie, Turbotax, H&R Block) - this could disqualify your application.

  3. Degree Information

    I. Provide information on the colleges or universities you attended that correspond to the undergraduate and/or graduate student loan debt you intend to include in this application. Also provide the city and state where each college or university is located, dates of attendance, the types of degrees you received and the college or university that awarded the degree.


    II. Indicate whether or not you were charged any in-State (Maryland) tuition by your undergraduate and/or graduate colleges or universities.

  4. Undergraduate and/or Graduate Student Loan Information

    I. Total Student Loan Amount. Provide the TOTAL amount of all loans incurred for your undergraduate and/or graduate postsecondary education only, regardless of where you attended the courses or programs.


    II. Eligible Undergraduate and/or Graduate Student Loan Balance. Enter the total remaining balance on all undergraduate and/or graduate student loan debt as of submission of the application.

  5. Tax Credit Information

    I. Previously Applied for Tax Credit. Indicate if you have applied for a Maryland Student Loan Debt Relief Tax Credit in any previous tax years.


    II. Previously Received a Tax Credit Award. Even if you did not take advantage of the tax credit on your tax return, you must indicate if you have ever received a Maryland Student Loan Debt Relief Tax Credit award in the past.


    III. Year of Tax Credit. Enter the tax year of the tax credit that was awarded to you.


    IV. Use of Proceeds from a Prior Tax Credit. If you answered “Yes” to the question, "Did you receive a Maryland Student Loan Debt Relief Tax Credit award in any previous years?" indicate whether you have provided the Commission with the required information on the use of the proceeds of the Student Loan Debt Relief Tax Credit award.

  6. Income Information

    I. Maryland Adjusted Gross Income. Enter the Maryland Adjusted Gross Income reported on your Maryland State Income Tax return form 502 (line 16) for the most recent prior tax year. Do not prorate your Adjusted Gross Income amount under any circumstances even if married filing jointly.

  7. Sign the Application

    By signing the application, you are affirming under penalty of perjury that the information in the application, including attachments, is true and correct. You also are agreeing that any credit will be used solely for the repayment of eligible student loans, and that the failure to abide by this requirement, including the failure to provide to the Commission documentation showing that you have abided by this requirement, may result in the revocation and recapture of your credit. In addition, you are agreeing to the release of certain information by your educational and financial institutions. Please review the requirements and conditions carefully before signing and submitting the application.

  8. Follow-Up Documentation

    If you receive a tax credit, then you must, within two years of the taxable year in which the credit is claimed, submit to the Maryland Higher Education Commission, documentation evidencing that you used the full amount of the tax credit for the repayment of eligible student loans. The failure to provide this documentation will result in the revocation and recapture of your credit.

  9. Send Completed Hard Copy Application To

    Maryland Higher Education Commission, Attn: Student Loan Debt Relief Tax Credit, 6 North Liberty Street, 10th floor, Baltimore, Maryland 21201.

  10. Questions

    studentdebttaxcredit.mhec@maryland.gov or (410) 767-4859.

What Happens After Submission

Read carefully

  1. Applicant submits application
  2. MHEC reviews application
  3. MHEC makes an award decision and applicants are notified
  4. Applicants that have been approved provide proof of college loan payments.

Agency/Contact

Form Issuer - Information

Who issues the Form?

Maryland Higher Education Commission Student Loan Debt Relief Tax Credit Program mhec.state.md.us/preparing/Pages/StudentLoanDebtReliefTaxCredit.aspx

Contact Information

Mary Logan, Program Manager

Email: studentdebttaxcredit.mhec@maryland.gov

Tel: (410) 767-4859