Hannah
How do I deduct student loans from my taxes when I am filing my taxes?
I am just really curious because my friend had lots of student loan debt and she was able to deduct her student loan interest from her taxes. #taxes
3 answers
Jenn Jones
Jenn’s Answer
If you purchase the online software like TurboTax, it walks you through step by step on how to do this. It is super easy to do this. You will receive a form in the mail at the end of the year with the information that you need to input into any online tax software.
Hope that helps!
Kelly M. Kent
Kelly M.’s Answer
You can then potentially deduct up to $2,500 of interest on Form 1040, page 1, line 33. In order to calculate deductible interest, I'd suggest using the worksheet provided in the IRS instructions: https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
Jeremy Styers
Jeremy’s Answer
First, you can't deduct loans. What you can deduct is interest paid on student loans during the year.
Second it's not all interest. There's a cap. Once you go over the cap nothing else will be deducted.
When it comes to student loan interest your provider will give you a form, either electronically or in the mail or both, which is the 1098-E. This form will simply list the provider info and the interest amount paid .
When filing your taxes using turbo tax or any tax software you will be asked about student loans. You simply tell the software you have a 1098-E and put in the amount. If you have more than one provider be sure to list each 1098-E in the software. That's it. It will deduct the right amount from your taxes.
You do not have to wait for the 1098-E to come in the mail. Most providers give the 1098-E electronically.
You should also look into other tax credits if still in college. Even if you have no income, some can be used to get money back.