If you live in Maryland, you have only days left to apply for a tax credit to cover some of your student loans. The state is offering up to $1,000 in tax credits for student loan debt relief, and the deadline to claim these tax credits is only two days away.
Eligible residents have until Thursday to submit the paperwork, after which the state will close the application portal.
How To Apply For The Maryland Tax Credits For Student Loan Relief
Maryland’s tax credit program for student loan debt relief has been in existence since 2017. The program offers an income tax credit to residents who make payments on loans from an accredited college or university. It has benefited more than 40,000 people, and over $40 million has been distributed since the start of the program.
About 9,155 residents received the tax credit last year. In 2021, people who attended in-state institutions received about $1,067 in financial relief, while those who attended out-of-state institutions received $875.
Central Scholarship.org notes that no set amount for the tax credit per person has been released, but most people receive around $1,000,
For the 2022 tax year, Maryland residents have until Sept. 15 to qualify for the credit. To apply for the Maryland tax credit for student loan relief, applicants need to visit the Maryland Higher Education Commission (MHEC) website. After a resident submits their application, the department will review it and inform them accordingly via email.
Who Is Eligible For The Tax Credits For Student Loan Debt Relief?
To be eligible for the tax credit for student loan debt relief, residents must have incurred a minimum of $20,000 in student loan debt and have at least $5,000 in outstanding student loan debt at the time of the application.
Further, the residents must claim Maryland residency on their 2022 tax filing and file 2022 Maryland state income taxes.
Those who didn’t attend a state school may also be eligible for the credit, but they may get a smaller credit than those who attended an in-state school. Even those who applied for President Joe Biden‘s student loan forgiveness program can apply for the tax credits for Maryland’s student loan debt relief.
The state will prioritize applications based on a number of factors, including debt-to-income ratios, if the applicant graduated from a Maryland university, whether or not they received a tax credit previously, and if they are eligible for in-state tuition.
Applicants who receive the credit may be asked to prove that they paid the amount of the credit they received to their lender. If found otherwise, they could be required to pay back the credit amount.
For more information on the tax credits for student loan debt relief, click here.
This article originally appeared on ValueWalk
Sponsored: Tips for Investing
A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses, consider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.