Friday, July 3rd, 2009

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

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

v b Says:
July 5th, 2009 at 6:01 am

$0 paid, $0 deductible.

TaxGurl Says:
July 7th, 2009 at 5:23 pm

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.

Judy Says:
July 10th, 2009 at 3:26 am

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

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