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Tax Deductions

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T

tsl90

Guest
I am trying to determine whether or not several items are deductqble on my Federal income tax.

Any assistance with these items would be helpful.

Student Loan Interest
I paid a few hundred dollars on the interest of my outstanding student loans this year. My income is low enough that this should be deductable. However my loans are still in forbearance (which means I'm not required to pay anything yet but interest is accruing) and what I've read says I can deduct within the first 60 months that I am required to pay. I believe this is meant to cut people off AFTER 60 months not before. Surely I can deduct interest now even though I'm not technically required to pay.?

Cell Phone & Computer
I use a cell phone and computer primarily for my work. My work does not specifically REQUIRE me to have these but nearly everyone in my field (medicine) has them and feels they are necessary. Are the costs of my cell phone bills and the computer I purchaced this year deductable?

Last year I owed an additional couple hundred dollars on my state taxes (OK). I sent this in in April of 2000. Surely this can't be deducted on this years taxes can it?

Any help with these items would be greatly appreciated.

Thanks
 


L

loku

Guest
Student loan, etc.

The law is a bit ambiguous about the forbearance period, but I believe you can deduct the payments under Proposed Reg. § 1.221-1(e)(3), which provides that the 60-month period is not suspended if under the terms of the loan interest continues to accrue while the loan is in deferment or forbearance, and the taxpayer has the option of paying the interest currently or requesting that it be capitalized and elects to pay it currently.

What this means is that the 60-month period runs during that time. That being the case, you should be able to deduct interest paid during that time.

If you use the cell phone and computer primarily for your work, you can deduct (or depreciate) the proportion of their cost that equals the proportion of their business use.

The state tax you paid in 2000 is deductible on your return for the year 2000.
 

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