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AL AND MARIE BORROWED $40,000 ON A QUALIFIED EDUCATIONAL LOAN TO PAY FOR QUALIFIED HIGHER EDUCATION...

AL AND MARIE BORROWED $40,000 ON A QUALIFIED EDUCATIONAL LOAN TO PAY FOR QUALIFIED HIGHER EDUCATION EXPENSES FOR THEIR TWO CHILDREN. DURING 2019 THEY PAID $1,800 IN INTEREST ON THE LOAN. THEIR MODIFIED AGI ON THEIR TAX RETURN WAS $160,000. THEY ARE ENTITLED TO DEDUCT ON THEIR TAX RETURN FOR THE YEAR.
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Al and Marie are allowed to deduct the whole amount as a deduction for interest on education loan i.e $1800 , as $2500 are allowed to be deduct only upto $ 135000 . It means you can deduct full amount of interest upto 2500 if a married counple having income less than 135000. A married couple cannot claim deduction if they are having AGI of $165000 or more .

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