Maryland Offers Student Loan Tax Credit Program for 2025

Maryland has continued its Student Loan Debt Relief Tax Credit program for the 2025 tax season, offering eligible residents up to $5,000 in financial assistance. The Maryland Higher Education Commission is accepting applications through September 15, with most successful applicants receiving an average of $1,800 according to MHEC Communications Director Kristin Clarkson. To qualify, applicants must be Maryland taxpayers who have incurred at least $20,000 in student loan debt and maintain a minimum outstanding balance of $5,000.

The Maryland General Assembly has allocated $9 million for the 2025 tax year, a decrease from the $17 million provided last year. The program has been operational since 2017, with approximately 85 percent of applicants receiving funds in the previous cycle. Statistics indicate that Maryland students completing programs at four-year public institutions typically graduate with about $22,000 in debt, while those from Historically Black Colleges and Universities (HBCUs) average around $28,000 in student loan obligations.

Clarkson noted the program's importance in the current federal student loan landscape, stating that the tax credit provides welcome relief as many borrowers resume payments following changes at the federal level. The application process takes approximately 15-30 minutes to complete, with the submission window closing on September 15, 2025. Applicants can access the form through the Maryland Higher Education Commission website.

Successful applicants will receive notification by December 2025. Recipients must demonstrate that they have applied the funds toward their student loan balance within three years or face a requirement to return the money. This accountability measure ensures the tax credit fulfills its intended purpose of reducing educational debt burdens for Maryland residents.