Are my student loan payments tax deductible?
The interest portion might be, thanks to the student loan interest deduction. The maximum deduction is $2,500 in 2011. You don't need to itemize to claim this deduction.
To qualify, you must meet three requirements:
First, the student loan on which you're paying interest must be one that you incurred to pay college expenses when you were at least a half-time student. This requirement excludes part-time adult learners or other nontraditional students.
Second, the interest must be paid during the first 60 months of the loan.
Third, you must meet income limits. In 2011, to take the full student loan interest deduction, single filers must have a modified adjusted gross income (MAGI) below $60,000 (below $120,000 for married filing jointly). A partial deduction is available for single filers with an MAGI between $60,000 and $75,000 (between $120,000 and $150,000 for married filing jointly).
If you paid over $600 of interest to a single lender on a qualified student loan during the year, you should receive Form 1098-E from your lender, showing the total amount of interest you paid for the year. If not, contact your lender to request this information.