Is the Student loan tax deduction worth not paying off the loan?
I have $23,000 worth of Student Loan Debt left. It’s been a tax deduction for me while paying it off but I have so many years left on it and now the rate is worse than if I went and got a loan elsewhere. I’m wondering, would it make sense tax wise to pay off the student loan with other money or does the tax deduction somehow cancel out the interest for the loan and make it worth it to keep it?
Where do people get the idea that a “tax deduction” is a benefit, if a debt can be paid in full.
Does no one understand that a “tax deduction is not a deduction ‘from’ taxes”?
The “deduction” reduces ones adjusted income, which is then taxed at a percentage, according to the income.
The “savings” is just a percent of the amount “deducted” from income.
Why would one pay out $100.00 in interest, and save a small percentage of $100.00? If ones income is taxed at 15%, one will save $15.00 of the $100.00
If one does not intend to fleece the taxpayer and actually pay off the loan, do it. Do the math.
