The good news is that the cap is increasing starting this tax year (2002), so this may still help some of the lower-paid PCP's out there. According to IRS publication 553 (Highlights of 2001 Tax changes), you'll still be eligible if you're married and earn less than 130K (only 65K for singles though).
"Beginning in 2002, the amount of your student loan interest deduction will be phased out (gradually reduced) if your modified adjusted gross income (MAGI) is between $50,000 and $65,000 ($100,000 and $130,000 if you file a joint return). You will not be able to take a student loan interest deduction if your MAGI is $65,000 or more ($130,000 or more if you file a joint return). For 2001, the deduction was phased out if your MAGI was between $40,000 and $55,000 ($60,000 and $75,000 if you filed a joint return) and you could not take a student loan interest deduction if your MAGI was $55,000 or more ($75,000 or more if you filed a joint return)."
•••quote:•••Originally posted by squeek:
•Having just done my taxes...
There is a cap to the income you can make and still deduct your student loan interest: $55K adjusted gross income if you are single, $75K if married filing jointly. So you'd actually be better off to pay the interest during residency, because as of right now you can't take the deduction later when you're making more money.•••••