Sallie Mae 1098-E

[payitoff]

Got our 1098 from Sister Sallie and for 2013 we paid $9698 in interest OUCH. Dept. of Education is $2128. ill just take this as a tax break, hopefully well get something back... do we?

[MustachianAccountant]

No one could even begin to answer that question without a LOT more information... best to just plug it into the tax program of your choice and find out.

[chicagomeg]

No one could even begin to answer that question without a LOT more information... best to just plug it into the tax program of your choice and find out.

That's not true. Only three things you need to know. 1-You can deduct up to $2,500 in student loan interest. 2-Your AGI (before deducting the student loan interest) must be less than $75,000 if you're filing single/head of household or $150,000 if you're filing jointly. 3-No deduction if you're married filing separately.

[MustachianAccountant]

No one could even begin to answer that question without a LOT more information... best to just plug it into the tax program of your choice and find out.

That's not true. Only three things you need to know. 1-You can deduct up to $2,500 in student loan interest. 2-Your AGI (before deducting the student loan interest) must be less than $75,000 if you're filing single/head of household or $150,000 if you're filing jointly. 3-No deduction if you're married filing separately.

-The student loan interest deduction is a PHASEOUT based on income. Yes, no more than $2,500 (but could be less, might be nothing, depending on facts)
-It looks like the OP is asking whether or not they'll get money back on their taxes this year. ("Hopefully we'll get something back. Do we?") Which, I maintain, is still impossible to tell with the given information.

[Mickijune]

I feel for you. I'm in the same boat. It makes me sad every year to see how much money is being thrown down the drain because I was told as a teen that I had to go to college to get anywhere in life. My degree does nothing for me! Double waste :(

[payitoff]

Thanks,
we're married filing jointly, with combined income of about $90,000 last year, this is our first full year of making student loan payments, total student loan is about $60,000. this year we'll be making more since it will be a full year for husband back to work, he started in March last year after school.

We're working on knocking off the first $25,000 last year and this year.  next year (2015) about $15,000 and the remaining $25k hopefully all of 2016

wow only $2500?

[MustachianAccountant]

Yes, you may only deduct $2,500 of the student loan interest paid.
I will also note that this is a DEDUCTION, which means that you don't pay tax on that $2,500. Which is not the same as paying $2,500 less tax.
In short, kill that debt. :-)

[MustachianAccountant]

Also:
You paid $11,826 on $60,000 debt? What's the interest rate? I'm roughly caclulating close to 20%?

[simonsez]

It is 75k and 155k for single and joint, respectively.  Table for the phaseout is near the bottom of the link.

http://www.irs.gov/publications/p970/ch04.html

As others have mentioned, yes, it is a deduction of your taxable income but one that you get even if you don't itemize. :)

[payitoff]

Also:
You paid $11,826 on $60,000 debt? What's the interest rate? I'm roughly caclulating close to 20%?

it was a combination of old and new student loans

$25,000 - old student loan at 11.5% - this was in deferment while he was in school for 2 years, so its compounded :( that's why were aggressively paying this off

$15,000 and $25,000 we just consolidated at 6.5%