Taxpayers can claim the student loan interest deduction only if they are legally obligated to pay the interest as a borrower or cosigner of the federal or private student loan. Voluntary payments by others count as though they were made by the borrower.
Can you claim private student loan interest on taxes?
The student loan interest deduction lets borrowers deduct all or part of the interest they pay on their federal student loans and private student loans when they file and submit their annual federal income tax return to the Internal Revenue Service (IRS).
Can a cosigner claim interest on a student loan?
I am legally obligated to pay the loan as a cosigner, but the 1098-E is in his name. He has not paid any of the loan or interest. He has given me the 1098-e and will not be claiming the interest on his taxes. We will both be filing as single with no one else claiming us dependents.
Can a parent claim the student loan interest deduction?
Yes, a parent who cosigned student loans may claim the student loan interest deduction. To claim the student loan interest deduction, the borrower must be legally obligated to make the payments on the student loans and the Student must be a dependent of the Cosigner. Cosigning the loans counts as legally obligated to make the payments.
Do you have to pay interest on a student loan?
You are legally obligated to pay the interest on the student loan. You actually paid the interest. Accumulation of interest on your balance by itself is not deductible. Further, the money received from the loan must have been used only for qualified higher education expenses, such as tuition, fees, room and board, books, supplies, and equipment.
Can a co-signed student loan be discharged?
Using them is kind of like paying for college with credit cards, except unlike with credit cards, the debt can’t be discharged. It’s too late to tell you that you shouldn’t have co-signed loans so close to retirement or any time you would be unable to take over the payments.
