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| 1. |
Q. |
What interest can be deducted?
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| A. |
The Taxpayer Relief Act of 1997 allows for deduction of interest paid on qualified student loans for the previous tax year. The act states it must be interest payments that are due during repayment periods.
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| 2. |
Q. |
Who can deduct interest?
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| A. |
You may be able to deduct interest on a loan if the loan was taken out for your own higher education expenses, or a loan for the expenses of a spouse or a dependent student to attend school at an eligible institution. The proceeds of the loan must have been used for the expenses of higher education and you or the student must have been enrolled at least halftime.
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| 3. |
Q. |
What loans are eligible?
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| A. |
Loans that are taken out for the sole purpose of paying for higher education may be eligible for the interest deduction. These loans include, but are not limited to, federal Stafford subsidized and unsubsidized loans, federal PLUS loans (Parental Loan For Undergraduate Student), federal Consolidation Loans, federal SLS loans (Supplemental Loan For Students), College Card, Career Funds, etc.
To find out more information on other types of loans that may be eligible, please consult a qualified tax advisor or the IRS.
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| 4. |
Q. |
How much interest can be deducted?
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| A. |
The maximum amount of student loan interest that can be deducted for the 2003 tax year is $2,500.00
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| 5. |
Q. |
Are there limits based on income?
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| A. |
The amount of interest that can be deducted is based on the amount of income that you earned for the tax year. If your income was more than $50,000.00 ($100,000.00 for joint return) it may limit the amount of interest you are eligible to deduct.
To find out more information on the income requirements, please consult a qualified tax advisor or the IRS.
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| 6. |
Q. |
How do I find out how much interest was paid?
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| A. |
A statement or letter will be sent to you by Southwest Student Services Corporation to advise of the amount of eligible interest that was paid during the tax year.
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| 7. |
Q. |
Do I need a 1098-E statement to file?
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| A. |
Currently the tax laws pertaining to Tax Benefits for Higher Education do not require a 1098-E to file. Southwest Student Services Corporation will notify you with a statement or letter as required by the tax laws.
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| 8. |
Q. |
How can I determine the amount of interest that can be deducted?
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| A. |
The amount of interest that is paid during the tax year and the actual amount that you may be able to deduct may not be the same. It is important that you consult a qualified tax advisor or the IRS to determine the amount of interest that can be deducted. Please note that employees of Southwest Student Services Corporation are not qualified tax advisors, therefore cannot answer questions pertaining to your personal tax return.
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| 9. |
Q. |
What is the tax ID for Southwest Student Services Corporation?
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| A. |
The tax ID for Southwest Student Services Corporation is 94-2850977.
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