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Student Loan Interest Deduction — Tax Deduction Guide 2026

Deduct up to $2,500 of student loan interest paid during the tax year.

$1,800
Avg Annual Savings
$2,500
Max Deduction
Above-the-Line
Deduction Type
Form 1098-E, Form 1040
Tax Forms

Eligibility

Individuals paying student loan interest with income under $90K single/$185K married

Tax Savings Calculator

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Estimated Tax Savings

$1,100

At the 22% tax bracket, a $5,000 deduction saves you $1,100 in taxes.

Savings by Tax Bracket

10%
$818
12%
$982
22%
$1,800
24%
$1,964
32%
$2,618
35%
$2,864
37%
$3,027

Requirements

  • 1Must be legally obligated
  • 2For qualified education expenses
  • 3Income phase-outs apply

Common Mistakes to Avoid

  • !Exceeding income limits
  • !Deducting parent PLUS loan interest on student's return

Required Tax Forms

Form 1098-EForm 1040

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Frequently Asked Questions

What is the Student Loan Interest Deduction?

Deduct up to $2,500 of student loan interest paid during the tax year.

Who is eligible for the Student Loan Interest Deduction?

Individuals paying student loan interest with income under $90K single/$185K married

How much can I save with the Student Loan Interest Deduction?

The average tax savings is $1,800 per year. The maximum deduction is $2,500. Your actual savings depend on your tax bracket and qualifying amount.

What forms do I need for the Student Loan Interest Deduction?

You'll need to file Form 1098-E and Form 1040 to claim this deduction.

What are common mistakes with the Student Loan Interest Deduction?

Common mistakes include: Exceeding income limits; Deducting parent PLUS loan interest on student's return. Always double-check requirements before filing.

Is the Student Loan Interest Deduction worth claiming?

With average savings of $1,800, the student loan interest deduction is worthwhile for most eligible taxpayers. Make sure you meet all eligibility requirements.

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