The student loan crisis is getting worse every year. Today, Americans owe nearly $1.75 trillion, and many are desperate for a way out from under their loans. The average student debt has only gone up over time too. At the start of the century, the average student owed around $17,000, but today that number is nearly $28,400.
If you’re looking for a solution to your student loans, the state of Maine is here to help! To draw in more young professionals, Maine is offering to help pay off the student loans of recent college graduates if they live and work in the state. Before packing your bags and applying for jobs, here’s everything you need to know about this initiative.
Maine’s Educational Opportunity Tax Credit
In 2008, Maine launched a tax credit program to entice young Maine residents to stay in the state. Initially, Maine residents who had gone to school in-state would receive credit on their income tax for the loans they paid. Now, as the state is in dire need of an infusion of young workers, the program has been expanded to college graduates from anywhere in the country, provided they graduated from 2016 on.
The average Maine resident is 44.6 years old, making it the oldest state in the country. In December, the Portland Press Herald reported that this has contributed to companies struggling to fill openings. Over time, the workforce is expected to get smaller and older.
Maine’s economy has been getting stronger for a decade, but without young workers, Maine could face some hard times. The program aims to help recent graduates and revitalize Maine with an influx of youth.
Qualifying For the Student Loan Credit
Maine residents and graduates from in-state schools are eligible for this program regardless of their graduation year. Assuming you don’t already live in Maine, you need to have earned your degree from 2016 on.
Here are the rest of the requirements for non-Maine residents to qualify for the Opportunity Maine Tax Credit:
- Be a Maine resident for the tax year.
- Work in Maine during the tax year with no more than three months of work outside of Maine, regardless of where your employer is located (includes self-employment).
Have earned a bachelor’s degree from an accredited school in the U.S. after 2015, or have earned a graduate degree in Maine after 2015.
If you earned a bachelor’s in a STEM field (science, tech, engineering, mathematics), not only will your individual income tax be wiped away, but if you paid more than your income tax, you may also receive a check from the Maine Revenue Services with additional credit.
Non-STEM degree holders can receive the same credit offsetting their income tax, but instead of receiving an additional check, they can apply any extra credit to income tax in the next ten years.
Additionally, the Maine state Senate is very close to approving a proposal that forgives up to $40K debt for first-time home buyers in Maine too. One caveat is that you’ll have to live in the house and maintain your primary residence in Maine for at least the first 5 years.
Why Move to Maine?
Even with the tax and loan incentives, moving to Maine still might not be enticing. If you’re looking for extra motivation, Maine has more to offer than just student loan assistance. For starters, Maine is one of the most beautiful states, especially in the fall. Between the beautiful coastlines and dense forests, if you love nature this is a perfect state to live in.
Maine, particularly Portland, offers high-quality food and drink. Maine lobster is a well-known dish, but the state’s acclaimed restaurants can help expand your taste, while Portland alone is home to 17 microbreweries, and in the past has been named SmartAsset’s best city for beer drinkers.
The Bottom Line
While some states and universities offer small-scale student loan assistance like Maine’s tax credit, only Maine offers something on this scale. There are obviously other ways to tackle your student loans, but few are as interesting or beneficial.