Reduce Your Tax Payments

Reduce your tax payments
Reduce your tax payments by claiming an​ interest payment deduction.
If you​ are busy paying off your student loans,​ the​ last thing you​ want to​ do is​ to​ pay interest on​ the​ money that you're about to​ give right back to​ the​ government .​
Luckily,​ in​ a​ lot of​ cases you​ should be able to​ deduct the​ amount of​ interest that you​ paid on​ your student loans .​
Deducting interests on​ student loans is​ not very difficult to​ do as​ long as​ you​ make sure that you​ meet the​ requirements for claiming this particular deduction on​ your taxes.
First of​ all,​ you​ have to​ have the​ proper filing status - which in​ this case means that you​ can be of​ any filing status except for if​ you​ are married and still filing your taxes separately .​
There is​ no explanation given as​ to​ why this particular status is​ exempt,​ however,​ this is​ still important to​ take note of​ before you​ waste your time trying to​ fill out a​ deduction that you​ cannot claim.
The other thing that is​ necessary in​ order for you​ to​ claim that deduction is​ that you​ cannot have another person claim you​ as​ a​ dependent or​ a​ tax exemption on​ their own tax forms .​
For most people who have already graduated from college and are trying to​ pay off their student loans,​ this should not be too much trouble .​
However,​ you​ should still make sure that nobody in​ your life is​ still claiming you​ as​ a​ tax deduction.
Finally,​ you​ have actually pay the​ interest on​ your student loan before you​ can claim it​ as​ a​ deduction .​
This also only works if​ you​ are the​ only person who has an​ actual obligation to​ pay off the​ loan .​
Therefore,​ you​ will not be able to​ claim a​ deduction if​ you​ are paying interest on​ a​ loan that both you​ and your parents owe money on,​ or​ on​ a​ parent PLUS loan.
You can also claim interest as​ a​ deduction if​ you​ are paying off the​ interest on​ a​ student loan that is​ owed by your dependent .​
However,​ in​ this case you​ can only deduct the​ payment if​ you​ are actually the​ person who is​ obligated to​ pay off the​ loans .​
You also need to​ claim an​ exemption for that dependent on​ your tax return.
Reduce Your Tax Payments Reduce Your Tax Payments Reviewed by Henda Yesti on June 26, 2018 Rating: 5

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