An Act to Amend the Credit for Educational Opportunity and
Maine Legislature, Session 132, LD 1574
Committee: Taxation
Sponsors: JACKSON
Amends: 36 MRSA §5217-D, 36 MRSA §5217-E

Legislative Document
No. 1574
H.P. 1032
House of Representatives, April 10, 2025
An Act to Amend the Credit for Educational Opportunity and 
Student Loan Repayment Tax Credit
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Representative JACKSON of Oxford.
Cosponsored by Representatives: ARATA of New Gloucester, COOPER of Windham, CRAY 
of Palmyra, DILL of Old Town, GUERRETTE of Caribou, HALL of Wilton.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §5217-D, sub-§2, ¶B, as amended by PL 2015, c. 482, §4, is 
further amended to read:
B.  A taxpayer may claim a credit based on loan payments actually made to a relevant 
lender or lenders under this section only with respect to loans that are part of the 
qualified individual's financial aid package and, for tax years beginning on or after 
January 1, 2015, only with respect to loan payment amounts paid by the taxpayer 
during that part of the taxable year that the qualified individual worked in this State.  
Payment For tax years beginning on or after January 1, 2015 and prior to January 1, 
2026, payment of loan amounts in excess of the amounts due during the taxable year 
does not qualify for the credit. For tax years beginning before January 1, 2015, 
refinanced loans that are part of the qualified individual’s financial aid package are 
eligible for the credit under this section if the refinanced loans remain separate from 
other debt, including debt incurred in an educational program other than the degree 
program for which a credit is claimed under this section.    For tax years beginning on 
or after January 1, 2015, refinanced loans or consolidated loans that are part of the 
qualified individual's financial aid package are eligible for the credit under this section 
if the refinanced loans or consolidated loans remain separate from other debt, except 
for debt incurred in an educational program, but only in proportion to the portion of the 
loan payments that are otherwise eligible under this section.  Forbearance or deferment 
of loan payments does not affect eligibility for the credit under this section.  For tax 
years beginning on or after January 1, 2015, an individual who worked in this State for 
any part of a month during the Maine residency period of the taxable year is considered 
to have worked in this State for the entire month.  For tax years beginning on or after 
January 1, 2015, an individual who worked outside this State for an entire month during 
the Maine residency period is considered to have worked in this State during that 
month, except that in no case may this exception exceed 3 months during the Maine 
residency period of the taxable year.
Sec. 2.  36 MRSA §5217-E, sub-§2, ¶C, as enacted by PL 2021, c. 635, Pt. H, §15, 
is amended to read:
C.  For taxable years beginning on or after January 1, 2022 and before January 1, 2027 
2026, a qualified individual with unused carryover credits pursuant to section 5217‑D, 
subsection 2, paragraph A from the credit for educational opportunity generated in the 
years from January 1, 2012 to December 31, 2021 may carry over and apply to the 
credit amount allowed pursuant to this section the portion, as reduced from year to 
year, of any unused credits.  For taxable years beginning on or after January 1, 2026, a 
qualified individual with unused carryover credits may carry over and apply to the 
credit amount allowed pursuant to this section the portion, as reduced from year to 
year, of any unused credits.
SUMMARY
This bill allows student borrowers to make early payment of eligible student loans and 
to carry the relevant income tax credit forward, taking up to the annual maximum income 
tax credit each year until the tax credit is entirely depleted.