topic Claiming interest on student loans in Deductions & credits

Claiming interest on student loans

suea96 — Sun, 02 Feb 2020 03:57:16 GMT

Can my daughter and I each claim the student loan interest (1098-E) on our own income tax returns or can only one person claim the interest? She is the borrower, and I am the co-signer.

Re: Claiming interest on student loans

xmasbaby0 — Sun, 02 Feb 2020 04:00:14 GMT

Who made the payments?

STUDENT LOAN INTEREST

Only the person whose name is on the student loan and who is legally obligated to pay the loan can deduct the student loan interest. If you did not sign or co-sign for the loan you cannot deduct the interest.

You cannot deduct student loan interest if you are being claimed as someone else’s dependent, or if you are filing as married filing separately.

The student loan interest deduction can reduce your taxable income by up to $2500

There is a phaseout for the Student loan interest deduction, which means the amount you can deduct gets reduced when your modified adjusted gross income hits certain income levels and is even eliminated at certain income levels -

• If your filing status is single, head of household, or qualifying widow(er), then the phaseout begins at $65,000 until $80,000, after which the deduction is eliminated entirely.

• If your filing status is married filing joint, then the phaseout beings at $130,000 until $160,000, after which the deduction is eliminated entirely.

Enter the interest you paid for your student loan by going to Federal>Deductions and Credits>Education>Student Loan Interest Paid in 2019 (Form 1098E)

Look on your 2019 Schedule 1 line 20 to see your student loan interest deduction

Re: Claiming interest on student loans

suea96 — Sun, 02 Feb 2020 04:08:59 GMT

That doesn't answer my question. I need to know if both of us can claim the student loan interest or if only one of us can.

Re: Claiming interest on student loans

xmasbaby0 — Sun, 02 Feb 2020 04:42:03 GMT

This is the first time I have seen anyone ask if they can "split" the interest paid on the student loan between them. If your child is your dependent, she cannot deduct the interest. If she is not a dependent, and you both paid on the loan, I see nothing in IRS Pub. 970 that says you cannot split the interest amount between you since she signed it and you co-signed. As long as the total amount you claim only adds up to the amount on the 1098E. @Carl ??

https://www.irs.gov/pub/irs-pdf/p970.pdf

Re: Claiming interest on student loans

Carl — Sun, 02 Feb 2020 16:32:17 GMT

The rules is Pub 970 do not address splitting... at least not directly. There are two "extremely" basic requirements to claim it.

- You must be legally obligated to pay it.

- You must have actually paid it.

A majority of the rules address when a person (not just the student) can not claim it. They can not claim it if:

- Married and filing separte

- Qualify as a dependent on someone else's return (weather they are actually claimed or not doesn't matter)

- Are not legally obligated to pay it (weather you actually paid it or not)

.. and a few other obscure ones I can't recall that don't seem to have an relevance here.