Looking for a Maine Tax Forms And Templates? Download it for free!

2016 Educational Opportunity Tax Credit Worksheet for Employers - Instructions

This worksheet and the related instructions are for employers who made eligible education loan payments directly to the lender on

behalf of qualiﬁ ed employees. Employers that are pass-through entities must also provide speciﬁ c owner information to assist each

owner in claiming their portion of the credit. Note: A self-employed person is eligible for the credit for educational opportunity for

employers only if the self-employed person has qualiﬁ ed employees. Self-employed persons eligible to claim the credit based on loan

payments made on their own behalf must complete the Credit for Educational Opportunity Tax Credit Worksheet for Maine Resident &

Part-year Resident Individuals. For more information on the individual credit, see the Educational Opportunity Tax Credit Worksheet for

Maine Resident and Part-year Resident Individuals.

The educational opportunity tax credit is a component of the Job Creation through Educational Opportunity program, which began in

2008. The credit is based on eligible education loan payments (deﬁ ned below) paid directly to the lender during the tax year for months

during which the employee was a resident of Maine and worked in Maine*. A Maine resident deployed for military service in the United

States Armed Forces or who is employed at least part-time on a vessel at sea also qualiﬁ es if the individual meets all other eligibility

criteria.

*NOTE: “Worked in Maine” includes an employee who has worked outside Maine for up to 3 months during the Maine residency

period of the tax year. An employee who worked in Maine for any part of a month is considered to have worked in Maine for

that entire month.

An employee eligible for the program is a graduate who:

● Obtained an associate or bachelor’s degree after 2007 or a graduate degree after 2015 from an accredited Maine or non-Maine

community college, college or university;

● After graduation, is a Maine resident (as deﬁ ned by Maine tax law in 36 M.R.S. § 5217-D(1)(H)) working in Maine.

If loan payments are made by both you and the employee, your credit is limited to the amount you paid directly to the lender. For

example, if the required 2016 monthly loan payment was $310 and you paid half ($155) and your employee paid half, your credit would

be $155 x 12 months = $1,860. Your employee would also be eligible to claim a credit of $1,860 based on the loan payments they

made.

Also, the combined credit for you and the employee may not exceed the monthly loan payment amount due multiplied by the number of

months eligible loan payments were made. If the combined monthly payment made directly to the lender by both you and the employee

is more than the required monthly loan payment amount, your credit will be prorated based on the ratio of the amount you paid to the

total amount paid directly to the lender multiplied by the loan payment amount due. For example, the required 2016 monthly loan

payments were $380 and you paid $200 and your employee also paid $200. The amount you may claim is limited to $190/month or

half of the required loan amount (your payment of $200 ÷ total payment made of $400 = .50 x total payment due of $380) x 12 months

= $2,280. Note that the credit claimed by the employee is similarly limited and also may not exceed the benchmark loan amount. For

more information on the individual credit, see the Educational Opportunity Tax Credit Worksheet for Maine Resident and Part-year

Resident Individuals.

Eligible education loan payments are payments made by an employer directly to the lender for public and private education loans

that are part of a ﬁ nancial aid package certiﬁ ed by an accredited Maine college or university and for loans associated with a degree

earned at an accredited non-Maine college or university.

● Only eligible education loan payments made during the part of the tax year during which the individual was a resident of Maine

working in Maine qualify for the credit.

● Payments in excess of the required loan payment are not eligible for the credit.

● Payments on a reﬁ nanced eligible education loan qualify for the credit as long as the reﬁ nanced loan remains separate from any

other debt incurred, other than educational loans.

SPECIFIC INSTRUCTIONS

Line 1. Enter the monthly eligible education loan payment due during your 2016 tax year. This is most likely the amount on the

employee's monthly payment voucher or electronic bill. Enter the total monthly amount due, even if part of it was paid by the employee.

Enter only the required amount due, excluding any accelerated payment.

Line 2. Enter the monthly amount paid toward the employee's eligible education loan during the year, regardless of whether you or the

employee made the payments.

Educational Opportunity Tax Credit Worksheet For Employers - Maine Department Of Revenue - 2016 Page 2

Related Articles

Related forms

Related Categories