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Category: Education: Tax Breaks Related to School

What types of loans DO NOT qualify for the student loan interest deduction?

You cannot deduct student loan interest if the loan was from one of the following sources.  Loans from these sources are not qualified student loans.

  • A related person.
  • A qualified employer plan.

Related Person:  You cannot deduct interest on a loan you received from a related person. Related persons include:

  • Your spouse
  • Your brothers and sisters
  • Your half brothers and half sisters
  • Your ancestors (parents, grandparents, etc.)
  • Your lineal descendants (children, grandchildren, etc.)
  • Certain corporations, partnerships, trusts, and exempt organizations.