Federal Student Loan Interest Deduction

What is the Student Loan Interest Deduction?

The student loan interest deduction is a tax break for college students and their parents who took on debt to pay for school.

How Does the Student Loan Interest Deduction Works ?

The student loan interest deduction allows you to deduct for the interest which you paid during the year on qualifying student loans.

Income Limits for Student Loan Interest Deduction

Student loan interest is deductible if, the maximums are a single taxpayer's MAGI of $85,000 and a joint taxpayer's MAGI of $170,000.

Who is Eligible for Student Loan Interest Deduction ?

Several criteria must be met in order to qualify for this deduction. You do not need to itemize your deductions because you are claiming this deduction as an adjustment to income.

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How Much is Student Loan Interest Deduction ?

The student loan interest deduction allows borrowers to deduct up to $2,500 of the interest paid on a loan for higher education directly on Form 1040.

How to Calculate THE Student Loan Interest Deduction ?

In general, your student loan interest deduction is limited to the lesser of, The amount of interest you paid throughout the tax year, or $2,500.

Which Expenses Qualify for Student Loan Interest Deduction ?

Tuition and fees for colleges, Room, board, and other living costs, Books, supplies and equipment, transportation are qualified educational expenses.

How to Claim the Student Loan Interest Deduction ?

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To claim this deduction, enter the allowable amount on Schedule 1 (Form 1040), line 21.

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