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S 2025

Waives pandemic unemployment assistance repayments under certain circumstances

2025 Regular Session Introduced by Jamaal Bailey and 14 co-sponsors

Massachusetts would offer a state tax credit for current residents who graduate from MA colleges and repay student loans, with caps by degree level.

REFERRED TO LABOR
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Bill Summary · S 2025

Summary — S.2025: Massachusetts Student Relief and Retention Tax Credit

Status: Referred to Labor (filed Jan 16, 2025; docket No. 1251). Presented by Sen. Edward J. Kennedy (First Middlesex).

Purpose

The bill creates a state income tax credit intended to encourage graduates of Massachusetts community colleges, colleges, and universities to remain in the Commonwealth after completing a degree. Its stated goal is long‑term retention of talent that relocates to Massachusetts for education.

Key provisions

  • Adds a new subsection (Section 6O) to Chapter 62 (Mass. income tax law) establishing the "Massachusetts student relief and retention tax credit."
  • Eligible taxpayers may claim a credit based on payments made on eligible education loans to relevant lenders during a taxable year while a resident of Massachusetts.
  • The credit amount is the lesser of:
    • The monthly payment amount on eligible loans multiplied by the number of months in the taxable year during which the taxpayer made loan payments (i.e., effectively the total payments counted as monthly-payment × months); or
    • A degree‑tier cap:
    • $1,000 for an associate degree
    • $2,000 for a bachelor’s degree
    • $3,000 for a graduate degree

Eligibility (as stated)

  • The program targets "qualified individuals" who completed a degree from an accredited Massachusetts community college, college, or university.
  • The bill requires the taxpayer to be a resident of the Commonwealth "for more than one entire taxable year" (the statutory language is literal and may require administrative clarification regarding the residency look‑back or duration requirement).

Who is affected

  • Primary beneficiaries: Massachusetts residents who graduated from an accredited MA higher‑education institution and who make payments on eligible student loans while resident in the state.
  • State government: potential reduction in personal income tax revenues to the extent credits are claimed; administrative responsibility for implementation (verification of degree, residency, and loan payments).
  • Lenders: not directly changed, except as payees of the loan payments used to substantiate claims.

Procedural / timeline notes

  • Filed as Senate Docket No. 1251 (Jan 16, 2025) and presented by Sen. Edward J. Kennedy.
  • Legislative action entries provided are inconsistent; reported status shows referral to the Committee on Labor. A hearing was scheduled for Sept 9, 2025 (per docket entries). Further committee review and fiscal analysis would typically follow before enactment.

Implementation considerations and ambiguities

  • The residency requirement ("more than one entire taxable year") is unclearly phrased and may require regulatory or statutory clarification.
  • The payment‑calculation method (monthly payment × months) may produce different results than summing actual payments if payment amounts vary; guidance would be needed for partial months, deferments, or income‑driven repayment plans.
  • No appropriation or fiscal estimate is included in the text; a state revenue impact analysis would be necessary to estimate cost and budgetary effects.

Compiled from official sources — confirm details with the bill’s official record.

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