<p>If student accrued interest, such as an unsubsidized FAFSA, does that count as “paid interest” on the return?</p>
<p>Just running through Turbo Tax and cannot quite tell if for consistency sake the student should report any and all interest accrued, from the annual report, at time of accrual or not until they actually pay it out of pocket?</p>
<p>No. You have to pay the interest to put it on the return. You will have received a statement with the paid interest on it.</p>
<p>Perfect, thank you</p>
<p>Just started doing our taxes. I thought I could deduct loan interest for a Stafford loan taken out by D who is our dependent. However one of the criteria stated for an eligible loan is a loan you are legally responsible for paying back. D is legally responsible, I have not co-signed the loans. So it sounds like I can’t deduct interest I paid. Am I interpreting this correctly?</p>
<p>That’s what it looks like from reading IRS 970. Only the person legally responsible for the loan can take the deduction. But if that person is claimed as a dependent on someone else’s taxes then they can’t take the deduction either. Double whammy there.</p>
<p>An example from IRS 970</p>
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<p>Thanks swimcatsmom. I hadn’t gotten to reading IRS 970 yet so that does confirm it. I’ve been procrastinating figuring out what credits we have for 3 college students so it’s time to move on to that fun analysis.</p>