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File Form 1098-E, Student Loan Interest Statement, if you receive student loan interest of $600 or more from an individual during the year in the course of your trade or business. The $600 threshold applies to each borrower regardless of the number of student loans obtained by that borrower.
Though personal loans are not tax-deductible, other types of loans are. Interest paid on mortgages, student loans, and business loans often can be deducted on your annual taxes, effectively reducing your taxable income for the year. You shouldnt need a tax break to afford a personal loan.
Each lender will issue its own form, so youll receive a 1098-E from your servicer if you have federal loans. If you have private loans, youll receive a separate 1098-E.
If youre wondering, Is student loan interest deductible? The answer is yes. In fact, federal student loan borrowers could qualify to deduct up to $2,500 of student loan interest per tax return per tax year. You can claim the student loan interest tax deduction as an adjustment to income.
Student Loan Interest Deduction Basics The largest amount you can claim for a student loan interest deductible is $2,500 for 2023 (and remains the same in 2024), but that is limited by your income eligibility. You may have paid more interest than that during the year, but that is the limit of your claim.
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California. Previously noted here as a state where statutes seemed to indicate taxability but where the state consensus ran in the other direction, California has now confirmed that it will, in fact, tax student loan debt discharge under current law.
No, you will not get in trouble with the IRS if you forgot to claim your student loan interest on form 1098-E. But you will lose the opportunity of an income deduction of up to $2,500.
Form 1098-E reports the amount of student loan interest you paid. It is issued if you have paid $600 or more during the tax year. Form 1098-T reports the amount of qualified education expenses paid during the tax year, which if applicable would be provided by your school!

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