Maryland Commission certifies tax credits for student loan repayment up to $5000

Maryland lawmakers have introduced House Bill 352, a significant legislative measure aimed at alleviating the burden of student loan debt for residents. Introduced on February 13, 2025, the bill proposes a state income tax credit for qualified taxpayers who have incurred substantial student loan debt.

The primary purpose of House Bill 352 is to provide financial relief to individuals who have accumulated at least $20,000 in undergraduate or graduate student loans. To qualify for the tax credit, applicants must have a minimum of $5,000 in outstanding student loan debt at the time of application. The bill stipulates that the Maryland Higher Education Commission will oversee the certification process for the tax credits, which can be claimed for the taxable year in which the credit is approved.

Key provisions of the bill include a requirement for individuals to submit their applications by September 15 each year, along with an assurance that any approved credit will be used for loan repayment. Notably, if the credit is not utilized for this purpose within three years, the total amount will be recaptured as taxes owed to the state.

The introduction of House Bill 352 has sparked discussions among lawmakers and stakeholders regarding its potential impact on Maryland residents grappling with student debt. Proponents argue that the bill could significantly ease financial pressures for many individuals, potentially leading to increased economic mobility and consumer spending. However, some critics express concerns about the bill's long-term fiscal implications for the state budget and whether it adequately addresses the root causes of rising student debt.

As the bill moves through the legislative process, its outcomes could have lasting effects on Maryland's approach to higher education financing and student debt relief. If passed, House Bill 352 may serve as a model for other states looking to implement similar measures to support their residents in managing educational expenses. The coming weeks will be crucial as lawmakers debate the bill's provisions and consider amendments that could shape its final form.