Tax questions

February 15, 2000

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.

Q.Last year was the first year I started paying back my graduate student loans. I paid approximately $2,590 in interest. I know that I get some type of tax break on that (my taxable income for 1999 was $38,600). How do I figure my tax savings? Is this for federal taxes only?

A.You are able to deduct up to $1,500 of interest paid on student loans during the first 60 months that payments are required on the loans. You are allowed an unlimited deduction if your adjusted gross income is less than $40,000 ($60,000 if married filing jointly), and you lose a proportional amount of the deduction for each dollar of adjusted gross income over those amounts. You can claim this deduction even if you do not itemize. In addition, the deduction is available for both federal and Maryland purposes.

Aaron Bloom, CPA, Ribis, Jones & Maresca, PA, Columbia

The above advice is for general purposes only and is not intended as legal, accounting or tax advice. Specific situations may vary.

To ask a tax question, call Sundial, The Sun's telephone information service, at 410-783-1800. Call 410-268-7736 in Anne Arundel County, 410-836-5028 in Harford County, 410-848-0338 in Carroll County. Using a touch-tone phone, punch in the four-digit code 6225 after the greeting. You can also submit questions by e-mail through The Sun's Web site, www.sunspot.net. Click on Business.

Selected questions will be answered in the Business section. No questions will be answered personally.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.