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Are There Any Limits On What Qualifies As A Student Loan?

Yes. The loan must have been used to pay the costs of attendance at an eligible educational institution for a student enrolled at least halftime in a program leading to a degree, certificate, or other recognized educational credential. An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution that is described in section 481 of the Higher Education Act of 1965 (20 U.S.C. 1088) and, therefore, eligible to participate in the student aid programs administered by the Department of Education.

This category includes virtually all accredited public, nonprofit, and proprietary postsecondary institutions. For purposes of the student loan interest deduction, eligible educational institutions also include institutions that conduct an internship or residency program leading to a degree or certificate awarded by an institution of higher education, a hospital, or a health care facility that offers postgraduate training.

Other Student Loan Interest Deductions FAQs

Q: Is A Student Loan Interest Deduction Available If The Student Loan Is Not Federally Guaranteed Or Otherwise Subsidized?
A: Yes. As long as the loan was used to pay the costs of attendance at an eligible educational institution and the other eligibility requirements are met; the deduction … More
Q: What Costs Are Included In The Costs Of Attendance?
A: Costs of attendance include all items that are included in costs of attendance for purposes of calculating a student's financial need in accordance with the Higher … More
Q: Is The Deduction Available For Interest Paid On Loans Used To Pay For Graduate School?
A: Yes. More
Q: Are There Any Limits On Who May Take The Student Loan Interest Deduction?
A: Yes, there are income restrictions. To claim the maximum deduction, a taxpayer must have modified adjusted gross income of $40,000 or less ($60,000 for married … More
Q: May A Former Student Whose Loans Are Already In Repayment Deduct The Interest They Pay On A Student Loan On Or After January 1, 1998?
A: Yes, but they may deduct only those payments made during the first 60 months that interest payments are required on a loan. If interest payments on a student loan … More
Q: May A Parent Claim The Student Loan Interest Deduction If The Parent Borrows To Pay His/Her Childs Costs Of Attending College?
A: Yes. A parent may claim the student loan interest deduction if the parent borrows money to pay the costs of attending college for members of the individual's family … More
Q: If An Individual Has Paid More Than $1,000 In Interest On Student Loans In 1998 And Is Otherwise Eligible To Take The Maximum Student Loan Interest Deduction, How Large A Deduction May The Individual Claim?
A: The individual's student loan interest deduction for 1998 is $1,000, provided the individual's modified adjusted gross income falls below the point where the … More
Q: Does An Individual Have To Itemize His/Her Income Tax Deductions To Claim The Student Loan Interest Deduction?
A: No. The student loan interest deduction is available regardless of whether an individual elects to take the standard deduction or to itemize deductions. More
Q: If A Student Is Claimed As A Dependent By His/Her Parent In A Particular Taxable Year, May The Student Take The Student Loan Interest Deduction For Student Loan Interest That He/She Pays In That Year?
A: No. The student may not claim the student loan interest deduction in any taxable year in which he/she is claimed as a dependent on another taxpayer's return. However, … More
Q: Are Tax Benefits Available If The Student Repays His/Her Loan By Performing Community Service Rather Than Making Cash Payments?
A: There may be. Loan forgiveness provided in return for community service is taxfree when it is part of certain lending programs run by the Federal, state, or … More

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