Student Loan Interest Deduction
Qualified individuals are able to deduct a portion of their education loan interest up to $1,000 in 1998, $1,500 in 1999, $2,000 in 2000, and $2,500 in 2001, and after.
Interest paid during the first 60 months (5 years) of scheduled repayment may be deductible. Deductions for student loan interest may be made for interest due and paid after 1997.
The tax credit is available for individuals with modified AGI under $40,000 and is phased out between $40,000 and $55,000. Joint filers with modified AGI under $60,000 (phased out between $60,000 and $75,000) are eligible for the deduction as well.