Yes, your parents may claim the loan interest deduction on a Parent Plus loan : The student loan interest deduction reported on form 1098-E is an adjustment to income up to $2,500 under income limitation - If you're married filing separately, or for 2020 if your modified adjusted gross income, or MAGI, is $85,000 or more if filing single or $170,000 if married filing jointly, you can't deduct any student loan interest. Your MAGI is essentially your adjusted gross income (AGI) with certain deductions added back in.
