An Act To Improve the Job Creation Through Educational Opportunity Program
Sec. 1. 20-A MRSA §12541, sub-§2, as amended by PL 2009, c. 553, Pt. A, §2, is repealed.
Sec. 2. 20-A MRSA §12541, sub-§2-A, as enacted by PL 2009, c. 553, Pt. A, §3, is repealed.
Sec. 3. 20-A MRSA §12541, sub-§4-A, as enacted by PL 2009, c. 553, Pt. A, §4, is repealed and the following enacted in its place:
Sec. 4. 20-A MRSA §12541, sub-§7, as amended by PL 2009, c. 553, Pt. A, §7, is repealed.
Sec. 5. 20-A MRSA §12541, sub-§8 is enacted to read:
Sec. 6. 20-A MRSA §12541, sub-§9 is enacted to read:
Sec. 7. 20-A MRSA §12542, sub-§1, as enacted by PL 2007, c. 469, Pt. A, §1, is amended to read:
Sec. 8. 20-A MRSA §12542, sub-§2-A, as amended by PL 2011, c. 548, §7, is repealed.
Sec. 9. 20-A MRSA §12542, sub-§3, as amended by PL 2011, c. 665, §§2 and 3, is repealed.
Sec. 10. 20-A MRSA §12542, sub-§3-A, as amended by PL 2011, c. 665, §4, is repealed.
Sec. 11. 20-A MRSA §12542, sub-§4-A, ¶C, as enacted by PL 2009, c. 553, Pt. A, §13, is amended to read:
Sec. 12. 20-A MRSA §12542, sub-§4-A, ¶D, as enacted by PL 2009, c. 553, Pt. A, §13, is repealed.
Sec. 13. 20-A MRSA §12542, sub-§5, as amended by PL 2009, c. 553, Pt. A, §14, is further amended to read:
Sec. 14. 36 MRSA §5122, sub-§2, ¶FF, as amended by PL 2011, c. 138, §1 and affected by §4, is further amended to read:
Sec. 15. 36 MRSA §5217-D, as amended by PL 2011, c. 665, §§7 to 12 and affected by §13, is further amended to read:
§ 5217-D. Credit for educational opportunity
(1) For individuals graduating from an accredited Maine community college, college or university before January 1, 2015, the amount calculated by the State Tax Assessor under Title 20-A, section 12542, former subsection 2-A; and
(2) For individuals graduating from an accredited Maine community college, college or university on or after January 1, 2015, the average in-state tuition and mandatory fees for attendance at the University of Maine System for the academic year ending during the calendar year prior to the year of graduation, multiplied by 2 in the case of an associate degree and multiplied by 4 in the case of a bachelor's degree.
(1) Attended, and obtained an associate or a bachelor's degree from, an accredited Maine community college, college or university after December 31, 2007. The individual need not obtain the degree from the institution in which that individual originally enrolled, as long as all course work toward the degree is performed at an accredited Maine community college, college or university, except that an individual who transfers to an accredited Maine community college, college or university after December 31, 2012 from outside the State and earned no more than 30 credit hours of course work toward the degree at an accredited non-Maine community college, college or university after December 31, 2007 and prior to the transfer is eligible for the credit if all other eligibility criteria are met. Program eligibility for such an individual must be determined as if the commencement of course work at the relevant accredited Maine community college, college or university was the commencement of course work for the degree program as a whole;
(2) Was a Maine resident while in attendance at the accredited Maine community college, college or university. For purposes of this subparagraph, "Maine resident" has the same meaning as in Title 20-A, section 12541, subsection 5;
(3) Lived in Maine while pursuing the degree, excepting periods when it was reasonably necessary for the individual to live elsewhere as part of the relevant institution's academic programs or while pursuing course work at an accredited non-Maine community college, college or university as provided in subparagraph (1);
(4) During the taxable year, was a resident individual; and
(5) During the taxable year, worked at least part time in this State for an employer, worked at least part time in this State as a self-employed individual or was deployed for military service in the United States Armed Forces, including the National Guard and the Reserves of the United States Armed Forces. As used in this subparagraph, "deployed for military service" has the same meaning as in Title 26, section 814, subsection 1, paragraph A.
(1) Who is domiciled in this State; or
(2) Who is not domiciled in this State, but maintains a permanent place of abode in this State and spends in the aggregate more than 183 days of the taxable year in this State, unless the individual is a member of the Armed Forces of the United States.
The credit under this subsection for an individual who transferred to an accredited Maine community college, college or university from an accredited non-Maine community college, college or university after December 31, 2012 and who earned no more than 30 credit hours of course work toward the degree at an accredited non-Maine community college, college or university is equal to 50% of the amount otherwise determined under this section in the case of an associate degree and equal to 75% of the amount otherwise determined under this section in the case of a bachelor's degree.
Notwithstanding subsection 2, paragraph C, the credit under this subsection is refundable to the extent the credit is based on loans included in the financial aid package acquired to obtain a bachelor's degree or associate degree in science, technology, engineering or mathematics or, with regard to an individual obtaining an associate degree in any field on or after January 1, 2015, to obtain an associate degree from an accredited Maine community college, college or university.
For purposes of this subsection, the proration factor is the amount derived by dividing the total number of academic credit hours earned for a bachelor's or associate degree after December 31, 2007 by the total number of academic credit hours earned for the bachelor's or associate degree.
The employer may claim a credit for the amount that the qualified employee could have claimed during any months when the qualified employee was employed, had the qualified employee made the partial or full loan payments instead, under conditions where the qualified employee had sufficient income to claim the full credit for the taxable year. If the qualified employee is employed only on a part-time basis during the taxable year, the employer may claim a credit only up with respect to that employee is limited to half of the total that the qualified employee could have claimed had the qualified employee made all payments and earned sufficient income to claim the full credit for the taxable year, but the amount the employer claims must still be based on amounts actually paid. An employer is not disqualified under this section if the qualified employee is not eligible to claim the credit solely because the employee's associate degree or bachelor's degree was awarded by an accredited non-Maine community college, college or university 50% of the credit otherwise determined under this subsection.
SUMMARY
This bill consolidates under the tax laws the provisions of statute that govern the determination of the income tax credit for educational opportunity. Currently, the relevant provisions are contained in the Maine Revised Statutes, Title 20-A and Title 36. By consolidating the provisions, the bill clarifies eligibility for the credit and, without changing the amount of the credit, the method by which the credit is calculated. In an effort to further reduce the administrative burden of the credit, the bill also extends the refundable portion of the credit available to individuals to all associate degrees, whether degrees in science, technology, engineering or mathematics or not, obtained from accredited Maine community colleges, colleges or universities for tax years beginning, and individuals graduating, on or after January 1, 2015. The bill also requires that an individual work in Maine after graduation in order to qualify for the credit, except that an individual may work outside Maine for up to 3 months and still qualify. This is a change from current law, which allows a qualifying individual to work outside Maine the entire year, as long as the individual is working for an employer located in Maine. The bill also removes the requirement that an individual work for an employer located in Maine. In addition, the bill clarifies that self-employed individuals who are not employers may participate in the program.