Karen is single and graduated from Marring University in May of 2013. In January of 2014, she begins repaying her student loans and in 2014 pays $2,800 of interest on the loans. Her adjusted gross income is $51,000. I. Karen can deduct $2,500 of interest as a deduction for adjusted gross income. II. Karen can deduct $2,800 of interest as a deduction from adjusted gross income.

Question

Quizplus · Accepted Answer

The maximum student loan interest deduction is $2,500. Since Karen paid $2,800, she can only deduct $2,500.

Karen Is Single and Graduated from Marring University in May