College students in Oregon are holding out hope for House Bill 4097, which would let let taxpayers in the state subtract loan interest from their federal taxable income. This is already permitted -- but with income eligibility and a $2,500 ceiling on the deduction for student loan interest.
The federal deduction flows through to the state tax return and cannot be claimed twice. HB 4097, however, would result in some Oregon taxpayers being allowed to subtract a higher amount. College enrollees pursuing degrees in science, math, or technology would be entitled to a tax credit based on their student loan interest -- depending on their earnings -- if they performed a certain number of volunteer hours and met other requirements. If approved, the bill could take effect in the January 2015 tax year and expire in January 2025.
According to Rep. Julie Parrish (R-West Linn), the bill would help students impact by the economic slowdown but also give Oregon graduates a reason to remain in the state to work.