Is money used to pay off student loans tax deductible?

No. But subject to certain conditions, the interest you pay on the student loans is. If you have a low interest rate on your loans, you're probably better off NOT paying it off and investing that money. read more

When repaying a student loan, the entire money used is not tax deductible. However, the interest charged is. In simple words, you cannot claim a deduction for the principal amount of loan, but for the interest you paid. read more

Although the annual deduction limit is subject to change, in 2010 you can deduct up to $2,500 of student loan interest payments. Eligible student loans. You can only claim the deduction for interest that accrues on student loan funds that you actually use to pay education-related expenses. read more

Student Loan Interest Is Tax Deductible If paying off your student loans is at the bottom of your priority list, the opportunity to claim the student loan interest deduction might be enough to motivate you to begin making payments consistently. read more