Does the thought of the upcoming tax season make you cringe? What’s the difference between a tax deduction and a tax credit? Most importantly if you’re a student borrower — what is the student loan interest deduction, and will it really save you money?
Tax season is often the source of stress and confusion, but it doesn’t have to be. With a little information on your side, you can tackle your student loans and your taxes. Credible’s guide to tax season will walk you through the processes of claiming education-related tax deductions and tax credits, and also help you navigate various pitfalls.
Our tax guide can also show you how to save money when you do your taxes. For example, did you know that the student loan interest deduction allows you to reduce your taxable by up to $2,500? By deducting the interest paid on a qualified student loan that you took out to pay for qualified education expenses, you could save up to $625.
If you’re married, did you know your tax filing status can affect your eligibility for certain income-driven student loan repayment plans, and the amount of your monthly loan payment?
Even if you don’t have any student loan debt, there are other education costs that you can claim on your taxes. The American Opportunity Tax Credit and the Lifetime Learning Credit are both great opportunities that allow you to claim up to $2,500 and $2,000 respectively for books, supplies and other education-related costs.
We’ll also alert you to pitfalls like the tax on forgiven student loan debt, and clue you in to tax savings plans and strategies.
Intrigued? Download Credible’s tax guide to find out whether you’re eligible to claim a tax credit and how much you could save this tax season.