Form 1098-E and the Student Loan Interest Deduction
Form 1098-E is the Student Loan Interest Statement that a lender or other recipient files when it receives $600 or more of student loan interest from an individual during the year in the course of its trade or business; box 1 shows the interest received. The student loan interest deduction is a separate figure: the IRS gives it as the smaller of $2,500 or the interest paid, reduced by a phase-out based on modified adjusted gross income, which for tax year 2026 starts above $85,000 ($175,000 for joint returns) and ends at $100,000 ($205,000), per Rev. Proc. 2025-32, and for tax year 2025 used $170,000 and $200,000 for joint returns, per Publication 970 (2025).
Maintained by Archie Chang · Sources checked against IRS text on November 2, 2026 · Methodology & sources
Who files Form 1098-E and the $600 rule
The IRS About page and the instructions give the same rule, and the instructions add that the $600 applies to each borrower:
“If you receive student loan interest of $600 or more from an individual during the year in the course of your trade or business:
file this form, and
provide a statement or acceptable substitute, on paper or electronically, to the borrower.”
“File Form 1098-E, Student Loan Interest Statement, if you receive student loan interest of $600 or more from an individual during the year in the course of your trade or business.”
“The $600 threshold applies to each borrower regardless of the number of student loans obtained by that borrower. However, you may file a separate Form 1098-E for each student loan of the borrower, or you may file one Form 1098-E for the interest from all student loans of the borrower.”
The instructions also say who files when more than one person is connected with a loan, and which loans they leave out:
“If more than one person has a connection with the loan, only the first person to receive the interest payment must file Form 1098-E. For example, a loan service or collection agent receiving payments on behalf of the lender must file.”
“Do not report interest on loans made under a qualified employer plan, as defined in section 72(p)(4), or under a contract purchased under a qualified employer plan within the meaning of section 72(p)(5).”
The instructions limit which loans are reportable for 2026:
“Qualified student loan. To be reportable for 2026, a student loan must be either:
Subsidized, guaranteed, financed, or otherwise treated as a student loan under a program of the federal, state, or local government, or of a postsecondary educational institution; or
Certified by the borrower as a student loan incurred solely to pay qualified higher education expenses. You may use Form W-9S to obtain the certification.”
“Report interest paid on revolving accounts, such as credit card accounts, only if the borrower certifies that all the loan proceeds are solely used to pay qualified higher education expenses. You do not have to verify the borrower’s actual use of the funds. Do not report interest on mixed-use loans.”
Form 1098-E, box by box
These are the boxes on the 2026 Form 1098-E (catalog number 25088U). The opening change notes in the 2026 Instructions for Forms 1098-E and 1098-T cover address fields, e-filing and IRIS and do not mention renumbered boxes.
| Box | Title in the IRS instructions | What the IRS says the box shows |
|---|---|---|
| 1 | Student Loan Interest Received by Lender | Shows the interest received by the lender during the year on one or more student loans made to you. For loans made on or after September 1, 2004, box 1 must include loan origination fees and capitalized interest received in 2026. If your loan was made before September 1, 2004, you may be able to deduct loan origination fees and capitalized interest not reported in box 1. |
| 2 | Checkbox | If checked, indicates that loan origination fees and/or capitalized interest are not included in box 1 for loans made before September 1, 2004. See Pub. 970 for how to figure any deductible loan origination fees or capitalized interest. |
The instructions say what the filer enters in box 1, and Copy B tells the borrower that box 1 and the deduction can differ:
“Enter the interest you received on a student loan(s) during the calendar year. For loans made on or after September 1, 2004, you are required to include in box 1 payments of interest as described in Regulations section 1.221-1(f). Under that regulation, interest includes capitalized interest and loan origination fees that represent charges for the use or forbearance of money.”
“A person (including a financial institution, a governmental unit, and an educational institution) that receives interest payments of $600 or more during the year on one or more qualified student loans must furnish this statement to you. You may be able to deduct student loan interest that you actually paid in 2026 on your income tax return. However, you may not be able to deduct the full amount of interest reported on this statement.”
The student loan interest deduction: amounts by tax year
The IRS describes the deduction as the smaller of two numbers, reduced when modified adjusted gross income (MAGI) is high:
“Student loan interest is interest you paid during the year on a qualified student loan. It includes both required and voluntarily prepaid interest payments. You may deduct the lesser of $2,500 or the amount of interest you actually paid during the year. The deduction is gradually reduced and eventually eliminated by phaseout when your modified adjusted gross income (MAGI) amount reaches the annual limit for your filing status.”
“Your student loan interest deduction is generally the smaller of:
$2,500, or
The interest you paid during the tax year.”
The phase-out amounts are inflation-adjusted, so they can differ by tax year. For tax year 2026 the amounts are in Rev. Proc. 2025-32; for tax year 2025 they are in Publication 970 (2025), the most recent edition of that publication we checked. The table shows both with their sources.
| Item | Tax year 2026 | Tax year 2025 |
|---|---|---|
| Maximum deduction | $2,500 (Rev. Proc. 2025-32, section 4.29) | $2,500 (Publication 970 (2025)) |
| Single, head of household or qualifying surviving spouse: phase-out starts when MAGI is more than | $85,000 | $85,000 |
| Single, head of household or qualifying surviving spouse: deduction eliminated when MAGI is | $100,000 or more | $100,000 or more |
| Married filing jointly: phase-out starts when MAGI is more than | $175,000 | $170,000 |
| Married filing jointly: deduction eliminated when MAGI is | $205,000 or more | $200,000 or more |
| Married filing separately | Calculator applies the Publication 970 (2025) rule: no deduction | No deduction: Publication 970 (2025) lists any filing status except married filing separately |
| Source | Rev. Proc. 2025-32, section 4.29 | Publication 970 (2025), Table 4-2 and Worksheet 4-1 |
Rev. Proc. 2025-32 words the tax year 2026 figures as one amount and one amount for joint returns; the split of the first amount across single, head of household and qualifying surviving spouse follows the Publication 970 (2025) table, and the calculator applies it to tax year 2026 as our reading, not an IRS statement, and the 2026 worksheet lines are our arithmetic on the Rev. Proc. 2025-32 amounts, not an IRS-printed worksheet. The two IRS documents say this:
“For taxable years beginning in 2026, the $2,500 maximum deduction for interest paid on qualified education loans under § 221 begins to phase out under § 221(b)(2)(B), as adjusted for inflation, for taxpayers with modified adjusted gross income in excess of $85,000 ($175,000 for joint returns), and is completely phased out for taxpayers with modified adjusted gross income of $100,000 or more ($205,000 or more for joint returns).”
“This revenue procedure sets forth inflation-adjusted items for 2026 for various Code provisions as in effect on October 9, 2025. The inflation-adjusted items for the Code sections set forth in section 4 of this revenue procedure are generally determined by reference to § 1(f). To the extent amendments to the Code are enacted for 2025 or 2026 after October 9, 2025, taxpayers should consult additional guidance to determine whether these adjustments remain applicable for 2026.”
“Except as provided in section 5.03 of this revenue procedure, section 4 of this revenue procedure applies to taxable years beginning in 2026.”
For tax year 2025, Publication 970 (2025) has this:
“However, the amount determined above may be phased out (gradually reduced) or eliminated based on your filing status and MAGI as explained below.”
“You can’t claim a student loan interest deduction if your MAGI is $100,000 or more ($200,000 or more if you file a joint return).”
“IF your filing status is... AND your MAGI is... THEN your student loan interest deduction is...
single, head of household, or qualifying surviving spouse
not more than $85,000 not affected by the phaseout.
more than $85,000 but less than $100,000 reduced because of the phaseout.
$100,000 or more eliminated by the phaseout.
married filing joint return
not more than $170,000 not affected by the phaseout.
more than $170,000 but less than $200,000 reduced because of the phaseout.
$200,000 or more eliminated by the phaseout.”
MAGI is defined in Publication 970 (2025) as follows, and the calculator takes the figure as you enter it:
“For most taxpayers, MAGI is AGI as figured on their federal income tax return before subtracting any deduction for student loan interest. However, as discussed below, there may be other modifications.”
Who cannot take it
Publication 970 (2025) lists the requirements, and Tax Topic 456 has a similar list worded for tax year 2025:
“Generally, you can claim the deduction if all of the following requirements are met.
Your filing status is any filing status except married filing separately.
No one else is claiming you as a dependent on their tax return.
You are legally obligated to pay interest on a qualified student loan.
You paid interest on a qualified student loan.”
“You can claim the deduction if all of the following apply:
You paid interest on a qualified student loan in tax year 2025;
You're legally obligated to pay interest on a qualified student loan;
Your filing status isn't married filing separately;
Your MAGI is less than a specified amount which is set annually; and
Neither you nor your spouse, if filing jointly, were claimed as dependents on someone else's return.”
Publication 970 (2025) gives an example of the dependent rule and lists items that are not student loan interest:
“Example 2. During 2025, you paid $1,100 interest on your qualified student loan. Only you are legally obligated to make the payments. Your parents claimed you as a dependent on their 2025 tax return. In this case, neither you nor your parents may deduct the student loan interest you paid in 2025.”
“You can’t claim a student loan interest deduction for any of the following items.
Interest you paid on a loan if, under the terms of the loan, you aren’t legally obligated to make interest payments.
Loan origination fees that are payments for property or services provided by the lender, such as commitment fees or processing costs.
Interest you paid on a loan to the extent payments were made through your participation in the National Health Service Corps Loan Repayment Program (the NHSC Loan Repayment Program) or certain other loan repayment assistance programs. For more information, see Student Loan Repayment Assistance in chapter 5.”
It also describes which loans qualify:
“This is a loan you took out solely to pay qualified education expenses (defined later) that were:
For you, your spouse, or a person who was your dependent (as defined later for this purpose) when you took out the loan;
Paid or incurred within a reasonable period of time before or after you took out the loan; and
For education provided during an academic period for an eligible student.”
Is a Form 1098-E needed?
The list of requirements for the deduction in Publication 970 (2025), quoted above, does not include receiving a Form 1098-E. Tax Topic 456 and Publication 970 (2025) say this about the form and about the amounts it shows:
“If you paid $600 or more of interest on a qualified student loan during the year, you should receive a Form 1098-E, Student Loan Interest Statement from the entity to which you paid the student loan interest.”
“Generally, an institution (such as a bank or governmental agency) that received interest payments of $600 or more during 2025 on one or more qualified student loans must send Form 1098-E (or an acceptable substitute) to each borrower by February 2, 2026 (January 31 falls on a Saturday).”
“You didn’t receive a Form 1098-E for 2025 from the lender because the amount of interest you paid didn’t require the lender to issue an information return.”
“The allocation of payments between interest and principal for tax purposes might not be the same as the allocation shown on the Form 1098-E or other statement you receive from the lender or loan servicer.”
Calculator: deduction from the Publication 970 worksheet steps
The calculator follows the steps of Worksheet 4-1 in Publication 970 (2025). Line 12 is rounded to three decimal places, the minimum the IRS allows. It starts on tax year 2026, with the Rev. Proc. 2025-32 amounts; tax year 2025 uses the Publication 970 (2025) amounts. The IRS describes the method this way:
“To figure the phaseout, multiply your interest deduction (before the phaseout but not more than $2,500) by a fraction. The numerator (top part) is your MAGI minus $85,000 ($170,000 in the case of a joint return). The denominator (bottom part) is $15,000 ($30,000 in the case of a joint return). Subtract the result from your deduction (before the phaseout) to give you the amount you can deduct.”
“Divide line 11 by $15,000 ($30,000 if married filing jointly). Enter the result as a decimal (rounded to at least three places). If the result is 1.000 or more, enter 1.000”
Publication 970 (2025) says which official worksheet applies to whom. The calculator follows the Worksheet 4-1 steps; this page does not claim that the two worksheets give the same results for every filer.
“Generally, you figure the deduction using the Student Loan Interest Deduction Worksheet in the Schedule 1 (Form 1040) instructions included in the Instructions for Form 1040. However, if you are filing Form 2555, Foreign Earned Income; Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa; or you are excluding income from sources within Puerto Rico, you must complete Worksheet 4-1.”
Publication 970 (2025) works two examples, and the calculator returns the same results for them: $800 of interest at $185,000 on a joint return gives a $400 reduction, and $2,750 of interest (capped at $2,500) at the same MAGI gives a $1,250 reduction.
“Example 1. During 2025, you paid $800 of interest on a qualified student loan. Your 2025 MAGI is $185,000 and you are filing a joint return. You must reduce your deduction by $400, figured as follows.”
“Your maximum deduction for 2025 is $2,500. You must reduce your maximum deduction by $1,250, figured as follows.”
Your figures
Enter the interest actually paid, not the box 1 amount if they differ. MAGI is the figure defined in Publication 970 (2025), chapter 4.
Worksheet arithmetic, tax year 2026
Enter the interest paid (0 or more) and MAGI to see the worksheet lines.
For loan terms and payments see the student loan calculator, the federal student loan interest rates and subsidized vs unsubsidized loans.
Due dates
Publication 1099 (2026) has a guide to information returns with one row per form. The guide’s two date columns are headed “To IRS” and “To recipient”, and a footnote adds the electronic filing date:
“Due date Form Title What to report Amounts to report To IRS To recipient (unless indicated otherwise)”
“1098-E Student Loan Interest Statement Student loan interest received in the course of your trade or business. $600 or more February 28* January 31”
“* The due date is March 31 if filed electronically.”
The guide also has a rule for dates that fall on a weekend or holiday:
“If any filing due date in these instructions falls on a Saturday, Sunday, or a legal holiday, you will be considered to have timely filed if you file by the next day that is not a Saturday, Sunday, or a legal holiday.”
Publication 970 (2025), quoted above, gave February 2, 2026 for the 2025 forms because January 31 fell on a Saturday. The other IRS information returns on this site are Form 1099-NEC and the 1099-R distribution codes.
What this page does not cover
- Whether a particular loan is a qualified student loan or whether expenses qualify; Publication 970 (2025) covers both.
- MAGI add-backs for foreign income exclusions and similar items; Publication 970 (2025) lists them. Enter your own MAGI.
- Penalties for filers and state tax treatment.
Frequently asked questions
What is Form 1098-E?
Form 1098-E is the Student Loan Interest Statement. The instructions have a financial institution, governmental unit, educational institution or any other person that receives student loan interest of $600 or more from an individual during the year in the course of its trade or business file it and give the borrower a statement. Box 1 shows the interest the lender received on the borrower’s student loans.
Is the $600 per loan or per borrower?
The instructions say the $600 threshold applies to each borrower regardless of the number of student loans the borrower obtained. A filer may file a separate Form 1098-E for each student loan of the borrower, or one Form 1098-E for the interest from all of the borrower’s student loans.
How much is the student loan interest deduction?
Publication 970 (2025) says it is generally the smaller of $2,500 or the interest paid during the tax year, and Tax Topic 456 gives the lesser of $2,500 or the interest actually paid. Both are phased out by modified adjusted gross income (MAGI). For tax year 2026, Rev. Proc. 2025-32 has the phase-out starting above $85,000 ($175,000 for joint returns) and ending at $100,000 or more ($205,000 or more for joint returns). For tax year 2025, Publication 970 (2025) gives $85,000 to $100,000 ($170,000 to $200,000 on a joint return).
Who cannot take the student loan interest deduction?
Generally, Publication 970 (2025) lists the requirements: any filing status except married filing separately, no one else claiming the borrower as a dependent, being legally obligated to pay interest on a qualified student loan, and having paid interest on one. Its Example 2 says that where parents claimed the student as a dependent, neither the student nor the parents may deduct the student loan interest the student paid.
Is a Form 1098-E needed for the deduction?
The list of requirements for the deduction in Publication 970 (2025) does not include receiving a Form 1098-E. That publication also has a worked example of a borrower who did not receive a Form 1098-E because the amount of interest paid did not require the lender to issue an information return, and it works out the deductible interest from the borrower’s account statement. Tax Topic 456 says a borrower who paid $600 or more of interest should receive a Form 1098-E.
Why can the deduction differ from box 1?
Copy B of the 2026 form says a borrower may not be able to deduct the full amount of interest reported on the statement. Publication 970 (2025) says the allocation of payments between interest and principal for tax purposes might not be the same as the allocation shown on Form 1098-E or other lender statement, and Copy B says box 1 must include loan origination fees and capitalized interest received for loans made on or after September 1, 2004.
How is the phase-out figured?
Worksheet 4-1 in Publication 970 (2025) takes interest paid (not more than $2,500), subtracts the phase-out start from modified adjusted gross income, divides by $15,000 ($30,000 if married filing jointly) as a decimal rounded to at least three places and capped at 1.000, multiplies that by the interest, and subtracts the result from the interest. Its Example 1 has $800 of interest and $185,000 of MAGI on a joint return, with a $400 reduction.
When is Form 1098-E due?
The Publication 1099 (2026) guide lists February 28 in its “To IRS” column and January 31 in its “To recipient” column for Form 1098-E. Put together, that is January 31 to the recipient; February 28 to the IRS (March 31 if filed electronically). Publication 970 (2025) gave February 2, 2026 for statements covering 2025 because January 31 fell on a Saturday.
Related IRS form pages and calculators
Sources (checked November 2, 2026): IRS: 2026 Instructions for Forms 1098-E and 1098-T, PDF · IRS: Form 1098-E (2026), PDF · IRS: About Form 1098-E · IRS: Publication 970 (2025), Tax Benefits for Education, PDF · IRS: Rev. Proc. 2025-32 (2026 inflation-adjusted items), PDF · IRS: Tax Topic 456, Student loan interest deduction · IRS: Publication 1099, General Instructions for Certain Information Returns (2026), PDF