Today's Tax Minute

The radio program "Tax Minute" can be heard every weekday morning at 6:25 on WCRN 830 AM.

STUDENT LOAN INTEREST
The law states that you can only deduct student loan or mortgage interest if you're legally required to pay the debt and actually pay that debt. There is an often overlooked exception to this rule. The IRS says that if a parent pays back a child's student loan, the parent can treat that money as given to the child who then paid the debt. So if you have a child who you do not claim as a dependent they can qualify to deduct up to $2,500 of student loan interest that you paid. And the deduction is an above-the-line deduction which means that your child does not need to itemize their deductions in order to take this write-off. This deduction can be especially helpful for those students out there who work and whose parent's income is too high for them to have any tax benefit by claiming them as a dependent.

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