Are student loans tax deductible for parents?

If you borrowed money in the form of a Parent PLUS Loan to finance your child’s college education, then you may be wondering if you qualify for any tax breaks. Good news: As a Parent PLUS borrower, you are eligible to claim the Student Loan Interest Deduction on your taxes.

One of the most common misconceptions about the student loan interest deduction is that a parent can claim it for helping make payments on their child’s loan. That is not the case. A parent can take the deduction only if they are personally liable for the loan.

Can a parent cosigner deduct student loan interest?

Moreover, the parent cannot claim the student loan interest deduction unless the parent cosigned the student’s loans. The loan must have been used to pay for qualified higher education expenses at a college or university that is eligible for Title IV federal student aid.

Can a parent deduct interest on a student loan?

To qualify for the student loan interest tax deduction, you must be legally obligated to repay the loan. That means your name must be on the loan’s promissory note. If you’re a parent, relative, or friend who helped a graduate with payments— but aren’t a cosigner on the loan — you can’t claim the tax deduction.

Are there any tax deductions for parents for college?

College Expenses That Are Tax Deductible for Parents 1. Tuition and Fees Deduction 2. American Opportunity Tax Credit 3. Lifetime Learning Credit 4. Student Loan Interest Deduction 5. Tax-Free Sales on College Textbooks 6. Home-Equity Loan Interest Deduction

Can a married person claim a student loan deduction?

You can’t be a dependent, or use the tax filing status “married filing separately.” If you’re a dependent, you won’t be able to write off the student loan interest you pay on your own loans (and neither can anyone else). You also can’t claim this deduction if you’re married and file taxes separately from your spouse.

Can You claim student loan interest as an exemption?

No one else can claim you as an exemption on his or her tax return. You are legally obligated to pay the interest on the student loan. You actually paid the interest. Accumulation of interest on your balance by itself is not deductible.