Annapolis is abuzz with tax chatter.
Income Tax Cuts for Retirees
Last week, Maryland Governor Larry Hogan informally announced a plan to cut (and in some cases eliminate) income taxes for retirees — an effort that he says “will keep tens of thousands of Maryland retirees from being forced to flee our state.” The bill, which has not officially been introduced, would include eliminating state income taxes on retirees who make less than $50,000 per year, as well as a reduction of 50% to 100% for retirees who make less than $100,000 per year. This type of proposal has been defeated before by state lawmakers.
Hogan has also proposed eliminating taxes on retirement income that’s tied to military service as well as an expansion of the state’s “Hometown Heroes” tax benefit. Under the 2017 Hometown Heroes Act, retired first responders such as police officers and firefighters are exempted from paying taxes on the first $15,000 of retirement income. Hogan’s new proposal will call for the elimination of all taxes for those individuals and lower the eligibility age from 55 to 50.
Student Loan Debt Relief
This week, the Hogan administration announced that 9,600 Marylanders qualified for tax credits under the Student Loan Debt Relief Tax Credit. That includes 6,331 eligible applicants who attended in-state institutions and will each get $1,000 in tax credits, as well as 3,269 eligible applicants who attended out-of-state institutions and will receive $813 each in tax credits. Last year, the Maryland Higher Education Commission awarded 9,484 Maryland residents tax credits under the initiative.