Credit For Educational Opportunity Worksheet For Individuals For Tax Year 2010 (Page 2 of 3) in pdf

2010

CREDIT FOR EDUCATIONAL OPPORTUNITY

WORKSHEET INSTRUCTIONS FOR INDIVIDUALS

GENERAL INSTRUCTIONS

Note: The Credit for Educational Opportunity Worksheet for Individuals and the related instructions below are only for

individual taxpayers who have made eligible education loan payments. Employers eligible to claim the related credit must

complete a separate worksheet – the Credit for Educational Opportunity Worksheet for Employers. Owners of pass-

through entities should also refer to that worksheet and related instructions regarding any credit amount for which they may

be eligible to claim.

The Credit for Educational Opportunity is a component of the Job Creation Through Educational Opportunity Program

available after 2007. The purpose of the program is to provide an income tax credit for education-related costs for Maine

residents who obtain an associate or bachelor’s degree from a Maine college, junior college or university and who, after

graduation, live, work and pay taxes in Maine. The credit is available to qualifying graduates and employers making eligible

education loan payments.

Qualifying graduates are those individuals who meet all of the following:

• the individual was a Maine resident while attending a Maine college or university in pursuit of an associate or bachelor’s

degree*;

• all coursework for the associate or bachelor’s degree was performed at a Maine college or university*;

• the individual obtained an associate or bachelor’s degree from a Maine college or university; and

• after graduation, this individual is a Maine resident working for an employer located in Maine.

For individuals enrolled in a degree program prior to January 1, 2008, these requirements need only be met from

January 1, 2008 forward.

Credit amount. The credit is equal to the eligible education loan payments (deﬁ ned below) paid by the taxpayer during the

tax year, limited to the benchmark loan payment amount. The benchmark loan payment amount applies only if the total prin-

cipal of loans the student received as part of a ﬁ nancial aid package exceeds the principal cap. The principal cap is based

on the in-state tuition and fees for the Maine Community College System or the University of Maine System, depending on

whether the degree is an associate degree or a bachelor’s degree and depending on the year of graduation. See Title 20-A,

§ 12542 (2-A). The principal cap amounts for 2010 are $3,300 for an associate degree and $7,865 for a bachelor’s degree.

These amounts are adjusted annually for a cost-of-living adjustment. The related benchmark loan payment amounts for

2010 are $72 for an associate degree and $343 for a bachelor’s degree.

If the eligible education loan payments are made by both the qualifying graduate and the graduate’s employer(s), the total

combined credit of the graduate and all employers may not exceed the benchmark loan payment amount multiplied by the

number of months during the tax year eligible loan payments were made. Also, a qualifying graduate and an employer

may each claim a credit only on the basis of eligible education loan payments they each made. For example, a qualifying

graduate may not claim a credit for a loan payment made by their employer. A credit may be claimed for both spouses on a

married-joint return if both spouses are qualifying graduates. The credit may not reduce the tax otherwise due to less than

zero. Any unused credit amount may be carried forward for up to 10 years.

Eligible education loan payments, for purposes of this worksheet, are payments made by, or on behalf of, a qualifying

graduate with respect to education loans that are part of a ﬁ nancial aid package for attendance at a Maine college or uni-

versity. Payments made in excess of the annual amount required by the ﬁ nancial institution are not eligible for the credit.

Payments made on loans with a term fewer than 8 years do not qualify as eligible education loan payments. Payments

made on reﬁ nanced eligible education loans qualify for the credit as long as the reﬁ nanced loan remains separate from any

debt incurred outside of the individual’s ﬁ nancial aid package.

SPECIFIC INSTRUCTIONS

Enter your name and social security number (“SSN”) in the spaces provided. Indicate whether you received a

bachelors degree or an associate’s degree. Enter date of graduation.

Credit For Educational Opportunity Worksheet For Individuals For Tax Year 2010 Page 2

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