2020 Student Loan Interest Deduction
For 2020, the Student Loan Interest Deduction figures are $2,500 (Maximum deduction), $70,000 (Phase-out threshold, single filers), $140,000 (Phase-out threshold, joint filers) and 2 more figures below.
| Item | Single filers | Joint filers |
|---|---|---|
| Phase-out threshold | $70,000 | $140,000 |
| Fully phased out | $85,000 | $170,000 |
Effective 2020-01-01Source: Rev. Proc. 2019-44 (IRS)Verified 2026-09-02
Compared with 2019
Every figure on this page is unchanged from 2019.
| Item | 2019 | 2020 | Change |
|---|---|---|---|
| Maximum deduction | $2,500 | $2,500 | +$0 (+0.0%) |
| Phase-out threshold, single filers | $70,000 | $70,000 | +$0 (+0.0%) |
| Phase-out threshold, joint filers | $140,000 | $140,000 | +$0 (+0.0%) |
| Fully phased out, single filers | $85,000 | $85,000 | +$0 (+0.0%) |
| Fully phased out, joint filers | $170,000 | $170,000 | +$0 (+0.0%) |
Phase-out threshold
Fully phased out
$70,000$170,000
One dot per column of the table, on a scale running from the smallest of these amounts to the largest. The scale is logarithmic - each faint line is ten times the one before it, so that the amounts crowded at the low end stay far enough apart to read. The table states which dot is which.
Who it applies to
Taxpayers who paid interest on qualified education loans and are claiming the student loan interest deduction on their 2020 federal income tax return.
What changed this year, and why
For tax year 2020, the IRS published the income thresholds at which the student loan interest deduction phases out. The maximum deduction remains $2,500. Single filers begin to lose the deduction when their modified adjusted gross income exceeds $70,000, and it is fully phased out at $85,000 or more. For joint filers, the phase-out begins above $140,000 and is complete at $170,000 or more.
Common questions
- What is the Student Loan Interest Deduction and how does it work?
- The Student Loan Interest Deduction lets eligible taxpayers subtract from their income the interest they paid on qualified education loans during the year, up to a maximum amount. For 2020, the maximum deduction is $2,500. The deduction phases out for single filers with modified adjusted gross income between $70,000 and $85,000, and for joint filers with income between $140,000 and $170,000.
How the deduction is reduced inside the phase-out range
When a taxpayer's modified adjusted gross income falls between the phase-out threshold and the fully phased-out level, the deduction is reduced by a specific fraction rather than eliminated entirely. The formula requires multiplying the interest deduction (before any phase-out, but capped at $2,500) by a fraction. The numerator of that fraction is the taxpayer's MAGI minus $70,000 for a single filer, or minus $140,000 for a joint return. The denominator is $15,000 for a single filer, or $30,000 for a joint return. That product is then subtracted from the original deduction (before the phase-out) to determine the amount the taxpayer can actually deduct. As income rises across this range the fraction grows from zero toward one, and the remaining deduction shrinks correspondingly. The width of the range is $15,000 for single filers and $30,000 for joint filers. Once MAGI reaches the fully phased-out amount, the fraction equals one and the entire deduction is lost.
To figure the phaseout, multiply your interest deduction (before the phaseout, but not more than $2,500) by a fraction. The numerator (top part) is your MAGI minus $70,000 ($140,000 in the case of a joint re- turn). The denominator (bottom part) is $15,000 ($30,000 in the case of a joint return). Subtract the result from your deduction (before the phaseout) to give you the amount you can deduct.
Publication 970 (2020), Tax Benefits for Education (IRS)
The income the phase-out is measured on
The student loan interest deduction is an adjustment to income, meaning you can claim it even if you don't itemize deductions. However, eligibility depends on your modified adjusted gross income. For most taxpayers, MAGI is the adjusted gross income as figured on their federal income tax return before subtracting any deduction for student loan interest. This means your MAGI is calculated before reducing it by the student loan interest deduction itself. The deduction is available if your MAGI is less than $85,000 for single filers or less than $170,000 for joint filers. Within the phase-out range ($70,000 to $85,000 for single; $140,000 to $170,000 for joint), the deduction is reduced proportionally. The maximum deduction is $2,500, which can reduce your taxable income by that amount if your MAGI falls below the phase-out threshold.
For most taxpayers, MAGI is the adjus- ted gross income as figured on their federal income tax re- turn before subtracting any deduction for student loan in- terest.
Publication 970 (2020), Tax Benefits for Education (IRS)
Who can claim the deduction
To claim the student loan interest deduction, you must meet all four of the following requirements. First, your filing status cannot be married filing separately - all other filing statuses qualify. Second, no one else can claim you as a dependent on their tax return. Third, you must be legally obligated to pay interest on a qualified student loan under the loan terms. Fourth, you must have actually paid interest on a qualified student loan during the tax year. If any of these conditions is not satisfied, you cannot claim the deduction regardless of how much interest you paid or how low your income may be. The deduction is claimed as an adjustment to income on your tax return, so you do not need to itemize deductions to benefit from it.
Generally, you can claim the deduction if all of the follow- ing requirements are met.
Publication 970 (2020), Tax Benefits for Education (IRS)
Payments that do not count as student loan interest
You can't claim a student loan interest deduction for any of the following items. Interest you paid on a loan is not deductible if, under the terms of the loan, you are not legally obligated to make interest payments. Loan origination fees are not deductible to the extent they are payments for property or services provided by the lender, such as commitment fees or processing costs. Interest you paid on a loan is also not deductible to the extent payments were made through your participation in the National Health Service Corps Loan Repayment Program or certain other loan repayment assistance programs. In each case, the payment fails to qualify as student loan interest for purposes of the deduction. Only interest you are legally obligated to pay, and that you actually pay from your own funds, counts toward the $2,500 maximum deduction.
You can't claim a student loan interest deduction for any of the following items.
Publication 970 (2020), Tax Benefits for Education (IRS)
You can keep deducting interest for as long as the loan lasts
For federal income tax purposes, the IRS allows taxpayers to deduct interest paid on a qualified student loan for as long as the borrower continues to make payments. There is no calendar limit on how many years the deduction can be taken; instead, the deduction ends only when the loan balance reaches zero. This means borrowers with long repayment terms, extended deferrals, or income-driven repayment plans can continue to claim the deduction each year they pay interest, even if the loan stretches over decades. The deduction remains available through the final payment, so taxpayers should not assume the benefit disappears after a set number of years. As long as the loan qualifies and the taxpayer meets the income and filing-status requirements for the student loan interest deduction, the interest paid each year reduces taxable income until the debt is fully satisfied.
You can deduct all interest you paid during the year on your student loan, including voluntary payments, until the loan is paid off.
Publication 970 (2020), Tax Benefits for Education (IRS)
Where the deduction actually lands on your return
For 2020, the student loan interest deduction is reported as an adjustment to income on Schedule 1 (Form 1040), line 20. Because it is an above-the-line adjustment rather than an itemized deduction, you can claim it whether or not you itemize on Schedule A. The maximum deduction for the year is $2,500 of interest paid on a qualified student loan. For single filers, the deduction begins to phase out at $70,000 of MAGI and is fully eliminated at $85,000; for joint filers, the phase-out range runs from $140,000 to $170,000. Taxpayers who file Form 1040 or 1040-SR start with the AGI on line 11, add back any amount already taken on line 20 for the student loan interest deduction, and then apply the modifications described in the instructions to arrive at MAGI. Once the allowable amount is figured - using the worksheet if necessary - it goes on Schedule 1, line 20, and flows into the adjusted gross income figure on the return.
To claim the deduction, enter the allowable amount on Schedule 1 (Form 1040), line 20.
Publication 970 (2020), Tax Benefits for Education (IRS)
The same interest cannot be deducted twice under two different provisions
The IRS prevents taxpayers from taking the same student-loan interest deduction twice under two different provisions of the tax code. If an amount qualifies as a deduction somewhere else - for example, as home mortgage interest - it cannot also be deducted as student loan interest. The rule also blocks any interest paid with proceeds from a qualified tuition program (QTP) distribution: to the extent those earnings are treated as tax-free because they covered education costs, the corresponding interest is not deductible here. The restriction applies regardless of filing status or income level, and it operates alongside the $2,500 annual cap and the 2020 phase-out ranges of $70,000–$85,000 for single filers and $140,000–$170,000 for joint filers.
No Double Benefit Allowed You can't deduct as interest on a student loan any amount that is an allowable deduction under any other provision of the tax law (for example, home mortgage interest).
Publication 970 (2020), Tax Benefits for Education (IRS)
Refinancing for more than the original balance can disqualify all the interest
If you refinance a qualified student loan for more than the original balance and use the extra proceeds for anything other than qualified education expenses, the IRS disallows the entire deduction on that refinanced loan - not just the interest attributable to the cash-out portion. This is a strict rule: even if part of the new loan still traces back to original school costs, none of the interest remains deductible once the refinancing exceeds the original principal and the surplus is diverted. The consequence is total loss of the student loan interest deduction for that loan, so taxpayers considering a cash-out refinance should be aware that the $2,500 annual benefit for 2020 (subject to the phase-out between $70,000 and $85,000 MAGI for single filers and $140,000 to $170,000 for joint filers) disappears entirely.
If you refinance a qualified student loan for more than your original loan and you use the additional amount for any purpose other than qualified edu- cation expenses, you can't deduct any interest paid on the refinanced loan.
Publication 970 (2020), Tax Benefits for Education (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Rev. Proc. 2019-44 (IRS)
- Maximum deduction
For taxable years beginning in 2020, the $2,500 maximum deduction for interest paid on qualified education loans under § 221 begins to
- Phase-out threshold, single filers
begins to phase out under § 221(b)(2)(B) for taxpayers with modified adjusted gross income in excess of $70,000
- Phase-out threshold, joint filers
for taxpayers with modified adjusted gross income in excess of $70,000 ($140,000 for joint returns)
- Fully phased out, single filers
and is completely phased out for taxpayers with modified adjusted gross income of $85,000
- Fully phased out, joint filers
taxpayers with modified adjusted gross income of $85,000 or more ($170,000 or more for joint returns).