The $2500 student loan payment deduction is for student loan interest (including the origination fee) so if we pay it off within 6 months of graduation, the only interest is the $18 (for this semester) origination fee, so I'm not worried about (us or her) deducting the interest. So if she got $1750 loan this semester, and $18 was origination fee, $1732 paid to the university, I figured $1732 was applied to QHEE for AOTC. Let's change my example to $11k tuition&fees - $6k scholarship - $4k applied to AOTC ($1732 of which was from loan) leaves $1000 from tuition and fees, $5k room and board and let's say $250 for books, I would therefore be able to claim all the room, board and books as well as the tuition and fees over the $4k applied to the AOTC, equaling $6250 as a qualified distribution from the 529? When I had been only counting on $4218. So I can take another $1732 from the 529 this year tax-free?
