Ryan Lane is an editor on NerdWallet’s small-business team. He joined NerdWallet in 2019 as a student loans writer, serving as an authority on that topic after spending more than a decade at student loan guarantor American Student Assistance. In that role, Ryan co-authored the Student Loan Ranger blog in partnership with U.S. News & World Report, as well as wrote and edited content about education financing and financial literacy for multiple online properties, e-courses and more. Ryan also previously oversaw the production of life science journals as a managing editor for publisher Cell Press. Ryan is located in Rochester, New York.
Lead Assigning Editor Karen Gaudette Brewer
Lead Assigning Editor | Core Personal Finance
Karen Gaudette Brewer leads the Core Personal Finance team at NerdWallet. Previously, she guided students and their families through the ins and outs of paying for college and managing student debt on the Higher Education team. Helping people navigate complex money decisions and feel more confident brings her great joy: as the daughter of an immigrant, from an early age she was the translator of financial documents and the person who called the credit card company to fix fraud.
She joined NerdWallet with 20 years of experience working in newsrooms and leading editorial teams, most recently as executive editor of HealthCentral. She launched her journalism career with The Associated Press and later worked for The (Riverside) Press-Enterprise, The Seattle Times, PCC Community Markets and Allrecipes.com.
She is a graduate of the 2022 Poynter Institute Leadership Academy for Women in Media. Her writing has been honored by the Society for Features Journalism and the Society of Professional Journalists. In addition, she’s the author of two books about the Pacific Northwest.
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The student loan interest deduction is a tax break for college students or parents who took on debt to pay for their school. It allows you to deduct up to $2,500 in interest paid from your taxable income.
Payments on federal student loans were paused from March 2020 until October 2023. If you didn't make any payments in 2023, then you likely don't have any interest to deduct on your tax return. But, if you made payments toward a capitalized federal loan interest balance or made interest payments made on loans that aren't eligible for the payment freeze, like private student loans, there is still an opportunity for you to deduct the interest paid.
Simplify your student loan refinancing with SparrowPre-qualify and compare rates with 17+ lenders to refinance your student loans through a single form in as little as three minutes.
Compare RatesStudent loan interest is deductible if your modified adjusted gross income, or MAGI, is less than $70,000 ($145,000 if filing jointly ). If your MAGI was between $70,000 and $85,000 ($175,000 if filing jointly), you can deduct less than than the maximum $2,500.
The student loan interest deduction is not an itemized deduction — it's taken above the line. That means it's subtracted from your taxable income to save you money.
If your MAGI is less than $85,000 ($175,000 if filing jointly), you can deduct student loan interest paid on federal and private student loans in the following instances:
You used the loan for qualified education expenses. These include tuition, room and board, books and other necessary expenses, such as transportation.
You're making interest payments while still in school. This deduction isn't just for graduates doing taxes: If you’re an overachiever who is making student loan payments while still in school, you may be able to take this deduction too.
You took out the loan for a dependent. If you took out a loan in your own name for someone else — like a parent PLUS loan for your child, for example — you can take the student loan interest deduction.
You were obligated to repay the loan. Even if your wages are being garnished or you're otherwise legally responsible for the loan, you can still deduct any interest you've paid off.
You can't claim the student loan interest deduction if your filing status is married filing separately. You're also ineligible if you’re listed as a dependent on someone else's tax return. A parent cannot claim the interest deduction — even if the student is claimed as a dependent — if the parent is not legally obligated to pay interest on the loan.
How many years can you deduct student loan interest?There is no limit to the number of years you can deduct student loan interest. You can take this deduction each year you're within the income limits, repay a qualified student loan and meet the deduction's additional eligibility requirements.
If you paid more than $600 in interest in 2023, you will automatically receive form 1098-E — a student loan interest deduction form — in the mail or by email.
You may have paid less than that amount with federal interest rates at 0% and payments suspended for all of 2023. But you can still deduct whatever you did pay if you otherwise qualify.
If you don't receive a student loan interest deduction document, ask your student loan servicer or private lender to send it to you. A copy of the form, as well as details on how much interest you paid, may also be available in your online account portal.
When you repay student loans , you pay down the original balance and the interest that has accrued on that balance. You can deduct that interest on your taxes, but the entire student loan payment amount is not tax-deductible.
For example, say you have a $29,000 student loan with an interest rate of 5%. At the start of the standard 10-year repayment plan, you'd pay roughly $308 each month with about $121 of that payment going toward student loan interest.
Over your first year in repayment, you'd repay $3,691 overall: $2,293 in principal and $1,398 in interest. If you qualified for the student loan interest deduction, you could reduce your taxable income by the portion that went toward interest.
This includes not just newly accrued interest — like that $1,398 — but also any money that pays off interest that was capitalized, or added to your balance, when you entered repayment.
If you're still in school or paying for education expenses, the government offers additional education tax credits and deductions . You can claim the American opportunity credit or the lifetime learning credit, or opt for the tuition and fees deduction if you don't qualify for a credit.
You can claim these benefits even if you paid for expenses with student loans. Your income and other factors can help you determine which will save you the most. As with the student loan interest deduction, you must file your taxes jointly if you're married to be eligible for these tax breaks.
Refinancing student loans can reduce your monthly payment and the amount of interest you pay. If you have private loans, use the calculator below to estimate your potential savings. Don't refinance federal student loans while payments and interest are paused.
Note: This calculator assumes that after you refinance, you’ll make minimum monthly payments.
Explore options for refinancing student loansEarnest Student Loan Refinance
NerdWallet's ratings are determined by our editorial team. The scoring formula for student loan products takes into account more than 50 data points across multiple categories, including repayment options, customer service, lender transparency, loan eligibility and underwriting criteria.
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Actual rate and available repayment terms will vary based on your income. Fixed rates range from 5.14% APR to 9.99% APR (excludes 0.25% Auto Pay discount). Variable rates range from 6.14% APR to 9.99% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 5.14% APR to 9.99% APR (excludes 0.25% Auto Pay discount). Variable rates range from 6.14% APR to 9.99% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.
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SoFi Student Loan Refinancing
NerdWallet's ratings are determined by our editorial team. The scoring formula for student loan products takes into account more than 50 data points across multiple categories, including repayment options, customer service, lender transparency, loan eligibility and underwriting criteria.
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Fixed rates range from 4.99% APR to 9.99% APR with 0.25% autopay discount. Variable rates range from 6.24% APR to 9.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates will never exceed 13.95% (the maximum rate for these loans). SoFi rate ranges are current as of 08/26/24 and are subject to change at any time. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi. You may pay more interest over the life of the loan if you refinance with an extended term.
Fixed rates range from 4.99% APR to 9.99% APR with 0.25% autopay discount. Variable rates range from 6.24% APR to 9.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates will never exceed 13.95% (the maximum rate for these loans). SoFi rate ranges are current as of 08/26/24 and are subject to change at any time. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi. You may pay more interest over the life of the loan if you refinance with an extended term.
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