[waitspring]

Hi, I have a question about the Student loan interest expenses deduction–Can parents claim the kid’s education loan when the parents paid for it? .

From the IRS website, I got the below example (https://www.irs.gov/publications/p970/ch04.html):

During 2014, Jo paid $1,100 interest on her qualified student loan. Only she is legally obligated to make the payments. Jo’s parents claimed an exemption for her on their 2014 tax return. In this case, neither Jo nor her parents may deduct the student loan interest Jo paid in 2014.

While, in CPAExcel, it said:

If the parent claims the student as a dependent, the parent can deduct the interest, even if the student paid it.

In the IRS example, the parents claimed an exemption for the kids, and the parents could not deduct the interest.

In the CPAExcel, if the parents claim the kids as a dependent, the parents can deduct the interest.

I am confused. Does claim an exemption the same as claim as a dependent?

Can anyone explain it? Thanks a lot!!

[spatel15]

I honestly don't know if this will help, but wasn't there something about “who” was actually obligated to pay the loan? I'm assuming the parent in Wiley took out the loan and spent the money for his/her dependent, i.e. the parent was obligated, and it was still deductible because it went toward an appropriate expense.

IRS is saying the parent didn't take out that loan, the kid did. No obligation for the taxpayer, even though he/she may be claiming the kid as a dependent.

[Author]

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