You can’t deduct qualified student loan interest payments you paid on a loan in your dependent’s name. Neither of you can deduct the loan interest if both of these are true: You claim the student as a dependent. You pay the student’s loan interest.
Who can claim the student loan interest?
Student loan interest is deductible if your modified adjusted gross income, or MAGI, is less than $70,000 ($140,000 if filing jointly). If your MAGI was between $70,000 and $85,000 ($170,000 if filing jointly), you can deduct less than than the maximum $2,500.
Can student loan interest be deducted by parents?
Generally, you can deduct interest only if you are legally required to repay the debt. But if parents pay back a child’s student loans, the IRS treats the transactions as if the money were given to the child, who then paid the debt.
Do you have to claim student loan interest on your taxes?
You claim this deduction as an adjustment to income, so you don’t need to itemize your deductions. You can claim the deduction if all of the following apply: You paid interest on a qualified student loan in tax year 2018; You’re legally obligated to pay interest on a qualified student loan;
Do you have to pay interest on qualified student loans?
You paid interest on a qualified student loan in tax year 2018; You’re legally obligated to pay interest on a qualified student loan; Your filing status isn’t married filing separately;
Who is the CPA for the student loan interest deduction?
Janet Berry-Johnson is a CPA with 10 years of experience in public accounting and writes about income taxes and small business accounting for companies such as Forbes and Credit Karma. The student loan interest deduction is an advantageous “above the line” deduction that you can claim without itemizing.
What is the maximum amount of interest you can claim on a student loan?
The most student loan interest you can claim as a tax deduction is limited to $2,500 as of the 2018 tax year.
