Is anyone taking advantage of the new Student Loan Repayment Tax Credit (SLRTC) for tax year 2022?

Submitted by happyharrr t3_zp40ae in Maine

Edit 12/28: New summary and frequently asked questions from MRS.

Maine is offering a new refundable tax credit starting this tax year called the Student Loan Repayment Tax Credit (SLRTC). It is replacing the Educational Opportunity Tax Credit. There were some news articles about this and it came up again more recently around when Biden announced his forgiveness plan.

Maine Revenue Services (MRS) provides a short summary of this program on page 6 and you can read the Maine Legislature SLRTC statute in full for more details. Outside of these two links, there is not much reliable information about this new tax credit.

In short, Mainers who obtained an associate, bachelor's, or graduate degree from an accredited community college, college, or university after December 31, 2007 can now apply for a refundable tax credit of up to $2,500 per year for eligible student loan payments up to a $25,000 lifetime cap.

Unfortunately MRS has not updated their website yet with information about the new SLRTC, but the website says that additional information on the SLRTC will be available soon (for the record, the website has said this since July).

There are still some things that I am not 100% clear on. Is this a dollar-for-dollar repayment match? Is a single lump sum payment acceptable? Do payments made during the federal pause still count? I assume yes to all, but I'm not certain. I'm hoping MRS will clarify some of these things once they update their website.

I know payments for most loans are still paused, but it might be worth considering for some of you. Based on what I know, I plan on making a loan payment in the next week in hopes that I will qualify for this. Anyone else planning on utilizing this tax credit?

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snackexchanger t1_j0r1gnr wrote

This is the first that I am hearing that the program is changing/being replaced. First I got screwed by the loan forgiveness because I refinanced my loans in February 2020.

Now the state credit is being cut roughly in half from a max of $4,500 down to $2,500? That’s quite a drop…

Now people who are above the $2,500 limit need to decide whether to take the financial hit in already tough economic times, especially for young people (which is the exact opposite of what they claim to be doing with this credit) or refinance their loans over a longer period, saving them money in the long run but keeping them in debt longer.

If you couldn’t tell I am not a fan of this change

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Comfortable_Bar_4837 t1_j0rx06b wrote

Loan forgiveness is not going to happen because. Republicans. Fuck you. Pay me

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tmssmt t1_j0sgdeh wrote

I've had nearly every dollar paid in returned to me via Maine's EOTC. Not quite forgiveness...but basically

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King_O_Walpole t1_j10689s wrote

Same here. It was a great program especially for STEM majors

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_Schneebley t1_j0raqpx wrote

I understand what you're saying, and it's true it will be handicapping some people, but it appears the state says that the median credit was $2,000 prior to this. And with it seemingly being a refundable credit now, the new $2,500 tax credit will actually be a boost to at least half the people who claimed the EOTC. I dare say a lot more than that even because there were also people who fell under the "nonrefundable" degrees and were handicapped even more, particularly the people who were perhaps on Income-Base Repayments and other programs.

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snackexchanger t1_j0rh8yg wrote

Everyone could have won if they had changed it from STEM degrees to STEAM degrees which seems to be becoming the preferred acronym in the educational system anyway…

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Bunt_Casket t1_j1k9575 wrote

From the new tax credit statute, worth looking in to in your case:

"... Refinanced loans or consolidated loans that are part of the qualified individual's financial aid package are eligible for the credit under this section if the refinanced loans or consolidated loans remain separate from other debt, but only in proportion to the portion of the loan payments that are otherwise eligible under this section."

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ninjasays t1_j0rubi3 wrote

Bachelors in 2004 and I stayed here. They always forget about me.

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_Schneebley t1_j0ra4vl wrote

So it seems, without the full language of this, that they did away with the STEM/Non-STEM separation for nonrefundable and refundable credits, and are just doing straight refundable credits for all degrees post 2007, up to $2,500 year and $25,000 lifetime. So basically 10 years of $2,500k tax credit, which you can be refunded on beyond what you owe for taxes for the year.

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SobeysBags t1_j0rxnm6 wrote

We will be taking advantage of this..I'm glad they finally simplified this.

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King_O_Walpole t1_j1073n6 wrote

Finally? It’s been pretty simple since 2010 when I started taking advantage of it.

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SobeysBags t1_j10dlp1 wrote

The process itself is not that hard, it just had all kinds of eligibility conditions attached to it based on when you graduated, where you graduated, and what type of degree you obtained. Now the only stipulation is that you live in Maine full time and have a degree from a recognized university/college. Doesn't matter, when, where, or what degree type.

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carmicdy t1_j0qkzzs wrote

Does it explain the difference between, the EOTC?

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happyharrr OP t1_j0qor0t wrote

I don't have a full grasp of the EOTC since I was never eligible for it, but my understanding is that the EOTC had a more convoluted eligibility system, and the SLRTC simplifies things and expands eligibility.

Whereas before under the EOTC, it was:

> * An associate or bachelor's degree from an accredited Maine college or university after 2007 and before 2016; or

  • An associate or bachelor's degree from an accredited Maine or non-Maine college or university after 2015; or,
  • A graduate degree from an accredited Maine college or university after 2015

Now under the SLRTC, it is: > An associate, bachelor's or graduate degree from an accredited community college, college or university after December 31, 2007

I think the biggest thing that comes from this is the inclusion of people with degrees from non-Maine universities who graduated between 2008-2015 who weren't eligible for the EOTC but are now eligible for the SLRTC.

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404-GeezManIDK t1_j0urt4q wrote

EOTC also covered cost of college outside of loans (I paid cash for Associates and qualified), will the SLRTC do the same? I'm assuming with "Loan" in the name that's a no, but could be wrong.

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snackexchanger t1_j0r5366 wrote

Looks like the big changes are

  1. They simplified the eligibility so the credit is not dependent on graduation year
  2. They DRASTICALLY decreased the credit amount (used to be $4,000+/year for a bachelors degree and now it’s $2,500)
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carmicdy t1_j0rc06t wrote

And still not refundable unless it's a STEM degree?

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nattatalie t1_j0vfg86 wrote

It looks like they finally changed it so non-working spouses can be claimed if the working spouse pays their loans which is a HUGE win in my book. I fought this for YEARS so I'm pretty excited about this change. Like I used to email every legislator about it every new session, and I have a lot of friends in the legislature and would hound them about it constantly. I'm glad it finally happened! I'm a stay at home mom but my husband works and pays my student loans and then can't claim them which is insane to me. We live in Maine, he works in Maine, I spend our money in Maine.

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MyDadIsTheMan t1_j12xv3u wrote

So this wouldn’t benefit during the Covid pause because people aren’t making payments—or at least the people who aren’t making payments can’t benefit from this until loans restart if I’m interpreting this correctly?

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Awakeonthewater t1_j1bn4ou wrote

From the frequently asked questions:
10. During the tax year, my education loans were in deferment or forbearance status. However, I have continued to pay my student loans during this time. Can I still claim the SLRTC for these payments?

Yes. You can claim the credit for eligible education loan payments you paid directly to the lender during the tax year. The SLRTC is not limited to loan payment amounts due.

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CHENGhis-khan t1_j0qnyqg wrote

So people who went to college get subsidies from people who didn't. Nice.

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MonsterByDay t1_j0qwsps wrote

Or, looked at another way, people with degrees get an incentive to stay and work in ME instead of moving to NH or MA. They may get a tax write off for some of their taxes, but if they leave the state we get nothing. Plus, they’ll still be paying property taxes, use taxes, and income tax beyond the max of $2500 for 10 years

Additionally, there’s the fact that tech companies and other big employers won’t come to an area that doesn’t have a pool of qualified workers. Opening it up to degrees from other states allows us to poach qualified worker from other states.

A rising tide lifts all ships. So, it seems like a solid investment to me.

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Logical-Ad2288 t1_j0rg3rf wrote

I find this so irritating. I am a nurse with $35,000 in student loans and my husband is a school psychologist with $75,000 in student loans. Four years worth of school for me and 8 years worth for him. People complain that we are “getting a free handout”, yet when you walk into an emergency room you expect to have everything available to you. You can walk in and have access to a doctor, nurse, X-ray tech, phlebotomist, lab tech, social worker, psychiatrist, etc. all at your fingertips. The list goes on and on. And guess what, almost all of these professions require some degree that will put us in a great deal of debt! Same for him at his school. If he wasn’t there to work with students with intellectual disabilities, emotional disturbance, students trying to self-harm etc, everyone would also be at a loss.

You want access to professional people in different areas of your life when it’s convenient for youyet don’t think we deserve to have some of our education costs offset by taxes or some other government funding.

I make $28 an hour as a nurse. This is not nearly enough to get ahead at all, never mind get out from under student loans for the next 40 years. $52,000 a year salary, if I work every single week, full-time, pre-taxes, not taking any days off.

If this is your attitude, don’t ever seek the advice/help/work from a professional employee ever again.

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aCandaK t1_j0rv13w wrote

As a therapist partnered with a college professor, both of us serve our communities and neither of us make even close to what many others do with our years of education. We chose our fields but assholes like the person above have no idea how much work, sacrifice, and money it takes to be able to help the kids they fuck up and the marginalized people hurt by their open and unnecessary hatred. It’s like so sorry you chose not to become educated but it doesn’t take away from the fact that college educated folks are needed and often strapped with ever increasing debt. I took out 100k in loans and if I pay do the standard repayment plan, I will pay over $40k in interest. Finally, the idea that the non-educated support the educated in any way is preposterous. Quite the opposite, even with a minimal tax credit.

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CHENGhis-khan t1_j0rktlh wrote

I don’t care about your situation. It’s none of my business. Your problems are just that. Your problems. It’s not societies’s duty to take care of you and your husband. You are obviously not poor so don’t stick your hand out. Have some fucking dignity.

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[deleted] t1_j0rno7n wrote

[deleted]

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CHENGhis-khan t1_j0rwq74 wrote

Justify it however you want. It doesn’t make it right. At the end of the day, you are subsidizing people who willingly accepted debt by taxing those that didn’t.

Principals are for chumps apparently. If that is true than we are truly lost.

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_Schneebley t1_j0ryk6x wrote

We’re incentivizing people to STAY and WORK, and here’s the shocker, IN MAINE

You know, that little state with an aging population that needs a younger workforce? It would help to have some new taxpayers here.

I know, it’s such a weird concept to grasp. Maybe based on you logic, we shouldn’t “subsidize” businesses because there are tax credits they can claim too?

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CHENGhis-khan t1_j0rzcjy wrote

No, we shouldn't subsidize anything. The tax code should fit on a single 8.5x11 sheet of paper, otherwise it's purpose is to pick winners and punish others. If you can't convince someone to stay, it's you. Something is wrong with you.

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_Schneebley t1_j0s08z9 wrote

> The tax code should fit on a single 8.5x11 sheet of paper, otherwise it's purpose is to pick winners and punish others.

I don't think many people will disagree with simplifying the tax code (which should happen on the Federal level to begin with), but, you're acting like you don't live in a very capitalistic society which inherently chooses winners and losers everyday. Refusing to participate in that now when it's full steam ahead is just illogical and would do nothing to help the state's ongoing problems.

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hbard23 t1_j0so8di wrote

Wow. You must be a real winner at parties. I bet you get all the invites with your attitude towards life and people.

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CHENGhis-khan t1_j0soxah wrote

"Everything I do is to attain affirmation from other people."

That's what you sound like. Your projection gland is leaking.

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hbard23 t1_j0sqi1y wrote

Thank you for backing up my earlier observation with further evidence of how you miserable you sound.

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CHENGhis-khan t1_j0t2lsn wrote

It only sounds miserable if you have overwhelming status anxiety. You might want to reevaluate how much you value social acceptance, and not use it as a surrogate for an argument.

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Logical-Ad2288 t1_j0vu2r3 wrote

Damn dude, I can only assume that your life thus far has been really shitty for you to have this type of attitude and the need to come on Reddit and argue with strangers. I hope life gets better for you.

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[deleted] t1_j0s2k5w wrote

[deleted]

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CHENGhis-khan t1_j0s8vqg wrote

You're like a new engineer messing with a PID controller for the first time. You make changes before the system meets a state and induce hunting. You are correcting a self correcting system. At this point you're trying to tune a system to your own errors.

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