Parent Pays Student Loan Interest: Who Deducts?
Separate payment and obligation.
Estimated reading time: 1 minute
For 2025 U.S. federal taxes, paying a student loan does not automatically make a parent eligible to deduct its interest.
Separate payment from obligation
Fictional 2025 gift: a parent pays $1,200 to the lender: $300 qualified interest and $900 principal. Only the student is legally obligated; the student cannot be claimed as a dependent, and all requirements for the full deduction are met.
Under the IRS 2025 guidance, the student is treated as receiving and paying the interest. The student may deduct $300, not $1,200. The non-obligated parent cannot deduct it.
A separate dependent case
If the parent validly claims the student in 2025, neither deducts it, assuming the same sole obligation. This is a separate scenario.
Check loan obligation, interest records, income, filing status and tax-year rules. Form 1098-E alone does not decide eligibility. Ask a tax professional.
Returned Loan Debit: Two Fees?
Trace the payment and fees.
Rehabilitation Payment Too High?
Check an alternative request.
