Many will receive a tax break as student loan bills become a regular expense.

• Qualifying for a tax break could be an advantage of making student loan payments.
• Qualifying borrowers can deduct up to $2,500 annually in interest paid on eligible private or federal education debt through the student loan interest deduction.

Your student loan payments could potentially decrease your 2024 tax liability.

Qualifying borrowers can deduct up to $2,500 in interest paid on eligible private or federal education debt, which was utilized by nearly 13 million taxpayers before the Covid pandemic, according to higher education expert Mark Kantrowitz.

During the pandemic-era pause on student loan bills from March 2020 to October 2023, most borrowers couldn't claim the deduction on federal student loans because interest rates on those debts were temporarily set to zero, and there was no interest accruing for borrowers to claim.

In 2025, retirees will see changes in Social Security and Medicare. Biden withdrew student loan forgiveness plans, but there is still debt relief available.

Federal student loans began accruing interest again in September 2023, and the first post-pause payments were due in October of that year.

Experts said that borrowers may again be interested in claiming interest on their full tax year's worth of payments.

Betsy Mayotte, president of The Institute of Student Loan Advisors, advised borrowers to examine their eligibility for the deduction in order to potentially lower their tax burden.

Student loan interest deduction worth up to $550

The student loan interest deduction is "below the line," which implies that you don't need to itemize your taxes to claim it.

Your lender or student loan servicer submits your interest payments for the tax year to the IRS on a form called 1098-E and should also provide you with a copy.

You can obtain the form from your servicer if it is not provided.

The student loan interest deduction could be worth up to $550 a year, according to Kantrowitz.

Individuals with a modified adjusted gross income of $80,000 or more will start to lose the deduction in 2024, while those with a MAGI of $95,000 or more are not eligible. For married couples filing jointly, the phaseout begins at $165,000, and those with a MAGI of $195,000 or more are ineligible.