| Title: |
Student Loan Interest Deduction |
| To: |
COHEAO Membership |
| From: |
Harrison Wadsworth, Executive Director |
May 6, 2004
The Department of Treasury released the following statement today concerning
student loan interest deductions. Please note that the statement includes
an eight month extension for final reporting requirements.
TREASURY ISSUES FINAL REGULATIONS ON STUDENT LOAN INTEREST DEDUCTION
This Department of Treasury press release may be viewed online.
The Treasury Department and the Internal Revenue Service today issued
final regulations relating to the deduction for interest paid on qualified
education loans.
"The final regulations issued today clarify which amounts qualify
for the student loan interest deduction to ensure that students obtain
the maximum deduction permitted under the law," said Acting Assistant
Secretary for Tax Policy Greg Jenner. "These regulations also provide
guidance to help lenders meet their reporting obligations."
The student loan interest deduction was enacted in 1997 and expanded
in 2001, when Congress eliminated the 60-month limit on the time during
which interest payments are deductible. These final regulations provide
guidance on the treatment of amounts such as capitalized interest and
loan origination fees, the deductibility of interest payments made by
persons other than the taxpayer, the definition of "qualified education
loan," and other issues.
Related regulations on information reporting by institutions that receive
payments of interest on qualified education rules were finalized in 2002.
Those regulations provided a transition rule for reporting loan origination
fees and capitalized interest. In response to comments, the student loan
interest regulations issued today provide additional time for institutions
to begin reporting payments of capitalized interest and loan origination
fees by extending the transition rule for eight months. Institutions
will be required to begin reporting those amounts with respect to qualified
education loans made on or after September 1, 2004.
Related Documents:
TD 9125
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