We wrote last month about the Maine Educational Opportunity Tax Credit. If you need a quick recap – Maine has the 7th highest debt per graduate in the US that averages $29,500. Nearly 70% of all Maine grads come out of school with debt. The program allows student loan debtors to get a tax break of up to $356 per month. That’s a quick glimpse of what the program offers – but here’s why it’s back in our news feed today – the program is expanding!
The current program extends to those that attended Maine universities and community colleges and then stay on to live and work in the state after graduation. It’s aimed at preventing brain drain – the term for emigration of trained or educated people out of a region. New legislation proposes that the program be expanded to graduates from outside of Maine to bring more talented and educated people into the state.
While the program still isn’t welcoming grads from across the country, it is opening up to those who obtained degrees in surrounding states. It’s targeted at students that participated in the New England Regional Student Program (RSP), which includes schools in Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. It’s important to note that this is not a huge expansion – it will only apply to Maine high school students that went to regional schools rather than a Maine college because the major they wanted wasn’t offered in-state.
Justin Chenette, co-sponsor of the bill, says, “Ultimately every kid that leaves the state to go to school, we should be saying, ‘We want you to come back here, to apply the knowledge you’ve learned elsewhere,’ because that’s how we’re going to move our economy forward.” Chenette hopes to continue to expand the program to give the tax credit to all out-of-state graduates.
The expanded credit has received the full support of the Taxation Committee and is expected to pass. The only hiccup could be getting funding for the program, but even with the money in hand, there’s a bigger obstacle that the program faces, whether or not the expansion passes – promoting it and getting people to participate.
The same issue plagues IBR and PAYE federal programs – too many people that could benefit from it and could desperately use the help it offers aren’t aware the program exists. According to Maine Revenue Services, in 2011, 710 grads used the program and by 2012, it was up to 1,157 participating grads, but this falls far short of the tens of thousands that likely qualify for the program.
If you live in Maine and graduated from a school there or in New England, click here for the form you need to calculate your tax credit. If you know anyone that lives and works in Maine, spread the word about this program so they can see if they qualify and take advantage.
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