Student Loan Debt Relief Tax Credit for Tax Year 2023 Details

Instructions

Review the steps - read carefully

1. Instructions

   Please read carefully. Applications containing errors or omissions will be rejected and may or may not come up for review again in the examination process. The application process closes on September 15, 2023 at 11:59:00 pm (EDT).

   I. When setting up your online account, permanent email addresses are required for receiving tax credit awards and correspondence from the Maryland Higher Education Commission (MHEC). Do not enter a temporary email address such as a workplace or college email.

   
   

   II. Set the following email addresses to not go to your spam. You will need them to receive important correspondence from MHEC:
   studentdebttaxcredit.mhec@maryland.gov
   onestop.support@maryland.gov

   
   

   III. If you already have an existing OneStop account from any previous year, it is advisable to use it again this year.

   
   

   IV. Do not abandon an application that you already started. You can save it and return to it later.

   
   

   V. Duplicate applications will be rejected. Entering more than one application in the same application year puts all of your applications at risk of being eliminated. Only the first application you create will be reviewed and taken into consideration.

   
   

2. Supporting Documentation

   The following must be included with your application. Fillable/changeable documents such as Word or Excel are not acceptable. PDF is the preferred format.

   I. Documentation from your lenders showing the educational loans that qualify for the tax credit. Documentation must include:

   -lender’s name, address, phone number; and
   -borrower’s name, account numbers, debt amount initially incurred, loan balance currently due

   Failure to provide proper lender documents could disqualify your application. Please do not get disqualified due to incorrect lender documents. Click here to see Lender Document Do's & Don'ts.

   II. A copy of your Maryland income tax return for the most recent prior tax year. You do not qualify for the tax credit if you do not provide the tax return (Maryland form 502).

   III. Transcripts from each undergraduate and/or graduate institution from which you graduated. Include only those transcripts that correspond to the college loan debt information you intend to provide. Name of institution and student must be on the transcripts. Unofficial and official transcripts are acceptable. Transcripts must show the name of the degree awarded and the date the degree was conferred.

3. Undergraduate and/or Graduate Student Loan Information

   I. Total Student Loan Amount. Provide the TOTAL amount of all loans you initially borrowed for your undergraduate and/or graduate education. Amount must be at least $20,000.

   II. Eligible Undergraduate and/or Graduate Student Loan Balance. Enter the total remaining loan balance STILL DUE on all undergraduate and/or graduate student loan debt as of the submission date of your application. Amount must be at least $5,000.

4. Income Information

   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 for any reason even if married filing jointly.

5. Degree Information

   I. Provide information on the colleges or universities you graduated from that correspond to the undergraduate and/or graduate student loan debt information you intend to include with your application. Provide the city and state where each college or university is located, dates of graduation, the degrees you received and the college or university that awarded the degree.

   II. Indicate if any of your tuition was classified as in-state (Maryland) tuition by any undergraduate and/or graduate college or university.

   
   

6. Tax Credit Information Required if you:

   I. Previously RECEIVED a tax credit award. Even if you did not claim the tax credit on your Maryland income tax return, indicate if you ever received a Maryland Student Loan Debt Relief Tax Credit award in any prior year.

   II. Previously CLAIMED the tax credit award. If you claimed the tax credit on your Maryland income tax return, indicate all tax years for which you claimed the award.

   III. Claimed the tax credit on your Maryland income tax return, indicate all tax years where you provided MHEC with the required documentation proving that you used the tax credit funds to pay toward your college loans.

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 Maryland Higher Education Commission (MHEC) 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 and claim it on your Maryland income tax return, then you must submit sufficient documentation to MHEC by December 31, 2026, proving 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. Tax-General Article of the Annotated Code of Maryland

   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 from an accredited college or university. These may include loans obtained to earn an undergraduate and/or graduate degree, such as an associate, bachelor, masters, professional graduate, doctoral, or post-doctoral degree. Award prioritization criteria are set forth in § 10-740 of the Tax-General Article of the Annotated Code of Maryland, and in the implementing regulations.

10. If you prefer to complete a hard copy application instead of applying online, you may mail it to:

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

11. Email your questions to:

    studentdebttaxcredit.mhec@maryland.gov