Don't think you can split it.  the student loan interest deduction is tied to the actual borrower and payer of the interest, not the guarantor. If the student is paying the interest, they can claim the deduction, even if the parents are guaranteeing the loan. 

Terry 53029,

As long as there is a legal obligation to pay the co-signers on the loan can take the deduction as long as they are obligated to pay.  My question was can you split the student loan interest amount if both the student and the parents are co-signers.

John

Terry,

How about the situation where the student was paying on the loan for the first half of the year and did not have the funds to continue paying and the parents who are the co-signers paid for the last half of the year.  It would seem fair to allow them to each take one half of the total interest since they both paid.  And with that in mind would I put the total 1098-E on the student's return and then nominee out the portion that the parents paid.

John

Tax law is very seldom fair it is the law that congress passed, and it is what it is 

Section 221 says that the deduction belongs to the person who paid it.  A guarantor who made some of the payments can deduct that share of the interest; a "default" is not required.  

An interesting point here is that the $2,500 annual limit on the deduction is not per loan, it is per taxpayer.  So if the total interest paid is $5,000 and the parents actually paid half of it, they can claim $2,500 and the student can claim the other $2,500.  

"It is what it is" is the phrase I use when someone asks me to define "vacuous," but that's neither here nor there.  

Terry,

I cannot find this anywhere on the internet doing research but if the student only paid for half the year and because they were not working for the other half of the year the parents paid for the last half of the year I do not see anything wrong with them splitting the interest for the portion that each paid on the loan.

John

Bob,

Thank you for your reply.  That seems to be a fitting answer to allow the actual payor of the loan to deduct their share of the interest since they were guarantors and stepped up to the plate after the student was not able to pay.  If the student received the total 1099 would you then show the total on the students return and say less amount belonging to guarantor with ss# and pick up guarntor portion with a small explanation on the guarantors return.

Thanks,

John

For that matter, you don't need no stinkin' 1098-E to deduct student loan interest.  You can put tuition on a credit card and deduct the interest paid on it, as long as you can trace it to the timely payment of qualified expenses.  

I would ignore the 1098-E except as evidence of total interest paid by both taxpayers.  Put the amount paid by the student on the student's return, and the amount paid by the parents on the parents' return.  

Bob,

Thanks that seems the right way to go.

John