Student Loan Interest 100% Tax-Deductible for All Marylanders Making Less Than $200,000 – Tuition Growth Capped at State Colleges & Universities
(ANNAPOLIS – January 14, 2016) – Governor Larry Hogan announced this week the administration’s 2017 Student Debt and Tuition Relief Initiative, as well as targeted investments in higher education. Governor Hogan made the announcement at the University of Maryland, College Park, where he was joined by Maryland Secretary of Higher Education James Fielder and Maryland Secretary of Housing and Community Development Ken Holt; as well as University of System Maryland Chancellor Dr. Robert Caret; University of Maryland, College Park President Dr. Wallace Loh and the University’s Board of Regents; University of Maryland University College President Dr. Javier Miyares; St. Mary’s College President Dr. Tuajuanda Jordan; Morgan State University President Dr. David Wilson; and Maryland Association of Community Colleges Executive Director Dr. Bernie Sadusky.
The governor’s proposal includes legislation to make student debt interest payments tax-deductible for all Marylanders earning less than $200,000 per year, funding to cap tuition growth at Maryland colleges and universities at a maximum of two percent, and targeted investments in priority projects at Maryland’s higher education institutions.
“Having a college education is more important now than ever before, but the harsh reality many face today is that earning a college degree often goes hand-in-hand with accumulating crippling college debt,” said Governor Hogan. “We believe that our new Student Debt and Tuition Relief Initiatives will provide much-needed relief from student loan debt, and will help us continue to make college in Maryland more affordable.”
In 2015, the Hogan administration immediately began working to ease the burden of student debt, which in many cases has become a burden to homeownership, by creating a mortgage initiative to help Marylanders with $25,000 or more in student loan debt, resulting in $90 million in mortgages closed. In 2016, the administration launched the Maryland SmartBuy initiative, a first-in-the-nation program that allows eligible buyers to purchase move-in-ready homes while eliminating their student loan debt burden. The first SmartBuy purchase was made on September 30, 2016.
“I thank Governor Hogan for his administration’s continued investment in higher education, and I applaud his efforts to ensure that even more Marylanders have access to the world-class education our universities have to offer,” said Chancellor Caret.
Governor Hogan’s 2017 Student Debt and Tuition Relief Initiative and higher education investments include:
Student Debt Relief Act of 2017: Under this proposal, the vast majority of Marylanders will be able to deduct 100 percent of the interest paid on their student loan debt from their income tax return. Beginning in 2018, Marylanders making less than $200,000 and couples making less than a combined $250,000 per year will not pay any Maryland income tax on their student loan interest payments. This proposal is expected to save Marylanders, many of whom are currently struggling to pay off college debt, $20 million each year.
Tuition Relief Initiative: Governor Hogan also announced his plan to make Maryland’s public colleges and universities more affordable by providing major tuition relief for the second year in a row. Maryland universities requested to raise tuition by as much as five percent in 2017, but Governor Hogan announced that the state would partner with these institutions to invest an additional $17.5 million dollars to allow 14 Maryland colleges and universities to cap tuition growth at two percent including all 12 University System of Maryland institutions, as well as Morgan State University and St. Mary’s College.
Investing in Higher Education: The governor announced an investment of more than $380 million in the 2017 Capital Budget for higher education projects across the state, including:
Additionally, Maryland’s community colleges will receive $56 million to fully fund all of their requested projects for the year, with an additional $8 million for projects at Goucher College, McDaniel College, and St. John’s College.