Employer Tax Credit for Student Loan Help Passes Senate

The state Senate this week approved legislation designed to keep Connecticut college graduates at home by creating a tax credit for employers who offer assistance with student loan repayments.

SB 72 applies to people who refinanced student loan debt through the Connecticut Higher Education Supplemental Loan Authority.

Beginning in 2022, employers making loan payments directly to CHESLA on behalf of an employee can claim a credit equal to 50% of total annual payments.

Employers are limited from claiming credits for loan payments higher than the amount due by the employee in a single year.

The bill defines a qualified employee as a state resident working a minimum of 35 hours a week at a Connecticut company.

The employee must have lived in the state at least five years since graduating college.

The bill is designed to address two issues Connecticut faces—the fact that too many of its college graduates relocate to another state, and the staggering debt many college graduates carry.

SB 72 is one of several bills proposed this session enabling employers to help workers pay off student loans.

The bill now moves to the state House.