Financial News & Information.

February 24, 2009

Can student loan interest be used as a tax deduction if the loans are in deferment/forbearance?

Filed under: United States — Tags: , , , , — admin @ 8:16 am
student loan
AG asked:


I know that student loan interest can be deducted.

My student loans are all either in deferment or forbearance. I’m accruing interest on some of them, but I haven’t actually paid any interest yet. Can I deduct the interest that accrued?

Thanks!

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3 Comments

  1. $0 paid, $0 deductible.

    Comment by v b — February 26, 2009 @ 6:56 am

  2. You can only deduct interest that you actually PAID during the tax year, not the interest that is accruing. Sorry to be the bearer of bad news but you have to wait until you start making payments on the loans to be able to take a deduction for any of the interest.

    Comment by TaxGurl — February 26, 2009 @ 10:25 am

  3. No, you can only deduct the interest when you actually pay it, not when it accrues

    Comment by Judy — February 28, 2009 @ 4:03 am

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