Bill would offer tax credit for student loan payments
Measure aimed at strengthening talent pool, keeping educated in R.I.
STATE HOUSE – Rep. Christopher R. Blazejewski and Sen. Ryan W. Pearson are sponsoring legislation to allow college graduates to claim a tax credit for payments on their student loans as a means of keeping talented, educated people in Rhode Island and encouraging innovators to make the state their home.
The “Stay Invested in Rhode Island Tax Credit” would authorize a credit against Rhode Island personal income tax for graduates who remain a resident of and work in Rhode Island for up to 10 years after graduation from an institution of higher education. The credit would be calculated based upon the student loan payments made during the tax year.
“We know we need to make changes to get our state’s economy moving forward again. One way we can do that is to work harder to retain Rhode Island’s college graduates, bolster our skilled workforce and make our state more attractive to innovative employers who will bring good jobs with good wages,” said Representative Blazejewski (D-Dist. 2, Providence). “The Stay Invested in Rhode Island credit will encourage more people to go to and finish college and to remain here after graduation, increasing the percentage of college graduates in the workforce here and helping to close our skills gap. This bill will help Rhode Island attract growing businesses by offering the kind of skilled workforce they need.”
The legislators emphasized that keeping more money in the pockets of recent graduates would also likely pump that money into the local economy, strengthening business in a second way.
“Student debt can be crippling to young professionals, who contribute so much to our economy and business climate. If they have more money, they can pay down that debt more quickly and are also better positioned to buy homes, vehicles and other necessary purchases large and small. That, in turn, will further boost our economy and have positive effects on businesses, communities and the state,” said Senator Pearson (D-Dist. 19, Cumberland, Lincoln). “The legislation is also an incentive that will help Rhode Islanders expand their educational goals, whether their plan is earning an associate’s degree, a bachelor’s or a master’s, so it would increase many Rhode Islanders’ lifetime earning potential as well as putting more money in their wallets in the short term.”
The bill (2015-H 5086) was introduced this week in both the House and the Senate.
It would allow a person to claim a tax credit against his or her Rhode Island personal income tax equal to the payments made toward undergraduate or graduate student loan debt, up to a maximum annual amount of $1,000 for an associate’s degree holder, $5,000 for a bachelor’s degree holder, and $6,000 for a graduate degree holder. The credit would be available to all Rhode Islanders, including those who move to Rhode Island from another state, prorated in proportion to the part of the year when they lived here.
In the House, the bill is cosponsored by Rep. Shelby Maldonado (D-Dist. 56, Central Falls), Rep. Joseph J. Solomon Jr. (D-Dist. 22, Warwick), Rep. Katherine S. Kazarian (D-Dist. 63, East Providence) and Rep. Aaron Regunberg (D-Dist. 4, Providence). Senate cosponsors include Sen. Adam J. Satchell (D-Dist. 9, West Warwick), Sen. Nicholas D. Kettle (R-Dist. 21, Coventry, Foster, Scituate, West Greenwich), Sen. Roger A. Picard (D-Dist. 20, Woonsocket, Cumberland) and Sen. Paul V. Jabour (D-Dist. 5, Providence).
For more information, contact:
Meredyth R. Whitty, Publicist
State House Room 20
Providence, RI 02903