Get About Form 1098-e, Student Loan Interest Statement

Do you have to file taxes on student loans? When filing taxes, don't report your student loans as income. Student loans aren't taxable because you'll eventually repay them.

Student Loan Interest Deduction You can take a tax deduction for the interest paid on student loans that you took out for yourself, your spouse, or your dependent. This benefit applies to all loans (not just federal student loans) used to pay for higher education expenses. The maximum deduction is $2,500 a year.

Each lender will issue its own form, so you'll receive a 1098-E from your servicer if you have federal loans. If you have private loans, you'll receive a separate 1098-E.

If you are paying off your student loans, you'll probably need to use Form 1098-E while completing your taxes. Generally, if you made student loan payments, you may be eligible to deduct a portion of the interest paid on your federal tax return.

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.

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 shouldn't need a tax break to afford a personal loan.

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.