Oh, and I assume that loans have to be deducted before taking a 529 disbursement, unless the student is paying off the loan (it was a subsidized loan this year, so she's not going to pay it off until after graduation, when she *may* take the funds from the 529, if there is anything left - but if the $4000 AOTC expense is subtracted from Box 1 this year, then books, computer, and R&B added to determine nontaxable amount to pull from 529, without subtracting the loan amount, it would be considered double dipping when she went to pull the loan amount - at least the principal (minus the origination fee) - 4 years from now).
I'm getting way ahead of myself, but when she does pay off the loan(s), do the origination fees count as "interest" - for example, of the $1750 loan for fall semester, only $1732 was applied to her tuition, so is $18 considered deductible interest when she pays it off (for sake of simplicity, let's assume she pays it within the grace period after graduation, so there is no other interest charged)?
