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alyssia-jones
New Member

Can you deduct a tax offset (student loan debt) on your taxes?

 
2 Replies
jtax
Level 9

Can you deduct a tax offset (student loan debt) on your taxes?

You can deduct student loan interest (not principal or fees) under many circumstances described in 

 

https://www.irs.gov/taxtopics/tc456 and https://www.irs.gov/publications/p970#en_US_2018_publink100010946 [pdf version is easier to read and is here (see page 31) https://www.irs.gov/pub/irs-pdf/p970.pdf ]

 

You need to figure out how much of the offset was interest for sure. And it had meet all of the requirements described above and be paid in 2019. (For 2019 taxes).  If you get a 1098-E that includes the offset payment, then use that. If you may need to ask for one, which might or might not be easy to get.

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SusanY1
Employee Tax Expert

Can you deduct a tax offset (student loan debt) on your taxes?

You cannot deduct a tax offset for student loan debt on your taxes.  However, you may be able to deduct the portion of the offset that represents student loan interest.

 

The agency servicing the loan will send you a Form 1098-E if any portion of your offset payment received was credited to interest.  If you receive this form, you will enter the interest into TurboTax following these steps:

  1. Login to TurboTax.Com.
  2. If you are beginning your return, TurboTax will ask if you paid any student loan interest in 2019. Answer yes and provide the information requested.
  3. If you do not see this question during the interview, you can navigate to it manually.  
  4. To find the section manually, click on the search icon (magnifying glass) in the upper part of your screen and type the term student loan interest. 
  5. Click on Jump to student loan interest at the top of the search results box. 
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