What is Opportunity Maine?
If you have not yet heard about Opportunity Maine, this tax break program could be a great addition to your financial health.
If you have earned an Associate or Bachelor's degree at a Maine school and have student loans, keep reading. If you choose to continue to live and work in Maine after graduation, you could be getting reimbursed for your student loan payments through the Educational Opportunity Tax Credit.
According to the Opportunity Maine, alternatively, businesses that pay employees’ student loans as an employee benefit will be able to claim the tax credit, providing a strong incentive to expand or locate businesses here in Maine.
As we all know, Maine has an aging population. 60 percent of Maine's population is 65 and older. Opportunity Maine not only helps recent grads with their student loans, but also encourages young, educated, and motivated people to stay in Maine.
After two years of work with many stakeholders, Opportunity Maine got a law passed in 2010 that simplifies and clarifies your ability to take advantage of the Educational Opportunity Tax Credit.
Keep in mind...
There are a few things to keep in mind when considering this option. Here are just a few suggestions from Opportunity Maine. For a more extensive list of how to participate in the Opportunity Maine program and FAQs, please visit the Opportunity Maine website.
Be thoughtful about your loans
The Educational Opportunity Tax Credit only applies to loans that you take out as part of your financial aid package. Loans that your family members take out will not qualify, and loans that your college does not recognize as part of your financial aid package will not qualify.
Finalize your documentation at graduation time
Your college’s financial aid office should have the documentation you need to fill out and will help you get everything together. They will give you the documentation you need and retain a copy for 10 years. If you don’t finalize your documentation at graduation, you can come back and do it later, but some of your loan payments may not be eligible for reimbursement through the Educational Opportunity Tax Credit if you wait too long!
Go into loan repayment in the ordinary way
As soon as you start making regularly scheduled loan payments, you are eligible for the Educational Opportunity Tax Credit. If you get a deferment or forbearance, then return to repayment, you’re still eligible. If you consolidate your loans, you’re still eligible, as long as you don’t consolidate your student loans with other debt.
Claim the credit on your Maine personal income tax return
Follow any instructions from Maine Revenue Services. Currently, you need to submit the documentation from your college with the first return where you claim the Educational Opportunity Tax Credit.
Retain your records
You need to keep records of your loan payments for five years if you are claiming the credit.