Student Loan Interest Deduction 2026

Who it applies to

The deduction reaches a taxpayer who paid interest on a qualified education loan under § 221 during a taxable year beginning in 2026, and how much of the $2,500 survives depends on modified adjusted gross income. Rev. Proc. 2025-32 states one pair of income figures for returns generally and a second, higher pair in parentheses for joint returns; a taxpayer whose modified adjusted gross income reaches the upper figure for their return type is completely phased out and deducts nothing. The revenue procedure states the amounts only. What counts as a qualified education loan, who may claim the interest, and how the phase-out is computed between the two income points are left to § 221 itself.

What changed this year, and why

The ceiling did not move. For taxable years beginning in 2026, Rev. Proc. 2025-32 states the maximum deduction for interest paid on qualified education loans under § 221 as $2,500, the same $2,500 Rev. Proc. 2024-40 stated for 2025. What moved is the income test: the procedure sets, as adjusted for inflation, the modified adjusted gross income above which the deduction begins to phase out under § 221(b) and the higher modified adjusted gross income at which it is completely phased out, and the pair of figures it gives for joint returns is higher than the pair Rev. Proc. 2024-40 gave for 2025. Rev. Proc. 2025-32 states its 2026 items for Code provisions as in effect on October 9, 2025.

Common questions

What is the maximum student loan interest deduction for 2026?

$2,500. Rev. Proc. 2025-32 describes it as the maximum deduction for interest paid on qualified education loans under § 221 for taxable years beginning in 2026. That figure is the ceiling before any income phase-out is applied, so a taxpayer above the relevant modified adjusted gross income limits deducts less than $2,500, or nothing at all.

Did the student loan interest deduction change for 2026?

The maximum did not. Rev. Proc. 2025-32 states $2,500 for taxable years beginning in 2026, the same amount Rev. Proc. 2024-40 stated for 2025. The income limits did move: the modified adjusted gross income figures for joint returns at which the deduction begins to phase out and at which it is completely phased out are both higher in Rev. Proc. 2025-32 than in the earlier procedure.

At what income does the student loan interest deduction phase out in 2026?

Rev. Proc. 2025-32 gives two income points. The $2,500 maximum begins to phase out under § 221(b) for taxpayers with modified adjusted gross income above a stated figure, and it is completely phased out for taxpayers whose modified adjusted gross income reaches a second, higher figure. Both points are stated as adjusted for inflation for taxable years beginning in 2026, and both are higher for a joint return.

Can married couples filing jointly deduct more than $2,500?

No. Rev. Proc. 2025-32 states one maximum deduction for interest paid on qualified education loans, $2,500, and states no doubled figure for a joint return. What changes on a joint return is the income test: the procedure gives higher modified adjusted gross income figures, in parentheses, for both the start and the end of the phase-out. The ceiling on the deduction itself is unchanged by filing status.

Are there separate phase-out figures for head of household or single filers?

Rev. Proc. 2025-32 states one pair of modified adjusted gross income figures that applies generally, with a second pair in parentheses for joint returns. It does not break the income limits out by any other filing status, so a single filer and a head of household read the same general figures. It also states no separate ceiling for either; the $2,500 maximum is common to all of them.

Can my employer pay my student loan tax free in 2026?

Rev. Proc. 2025-32 records that the One, Big, Beautiful Bill Act amended § 127(c) to make permanent the treatment of employer payments of principal or interest on a qualified education loan as educational assistance. The procedure states a maximum exclusion amount for that benefit and notes it will be adjusted for inflation for taxable years beginning after 2026. That exclusion is separate from the § 221 deduction and has its own ceiling.

Which tax year does the $2,500 deduction apply to?

Rev. Proc. 2025-32 states the interest on education loans item for taxable years beginning in 2026, and its effective date section applies the 2026 adjusted items to taxable years beginning in 2026. This item is not among those routed to the calendar year rule instead, so the figures follow the taxpayer's taxable year rather than the calendar year in which the interest happened to be paid.

Where does the $2,500 student loan interest deduction come from?

It is the maximum deduction under § 221 of the Internal Revenue Code. Rev. Proc. 2025-32 restates it, and publishes the inflation-adjusted phase-out limits that go with it, in its interest on education loans item. The procedure says the inflation-adjusted items it sets out are generally determined by reference to § 1(f), so the income limits track the statutory indexing rule rather than an annual discretionary choice.

Every amount on this page is a published figure rather than yours. The Student loan interest deduction for a single filer takes the number you enter and works it out against them, showing which published figure it used.