Tax Filter: Why would the fact that I paid interest on student loans last year mean I owe the IRS more money?
March 25, 2006 2:47 PM Subscribe
Tax Filter: Why would the fact that I paid interest on student loans last year mean I owe the IRS more money? I was doing my taxes on TurboTax today, and I have two 1098-E forms which say that I paid a total of $1,700 dollars in interest last year on student loans. This is the first year I'm paying on loans rather than taking them out, so I'm not sure how it works. My little counter at the top of the screen was saying I was getting an $800 refund until I entered that amount. After that, it said I would owe the IRS $450 this year. When it said I might be able to take the $1,700 as a deduction, that seemed like a good thing... so why do I owe now when before, I didn't? I don't get it.