My spouse and I received a chunk of cash that we would like to use to pay off student loan debt. The cash is not enough to pay off both of our loans. If we simply put the cash towards the highest interest loans, one of us will no longer have any student loans under our name. We usually file taxes "married filing jointly" in the United States.
When filing jointly, will we receive more tax-deductions if both of us have student loans under our name? If that is the case, would it be better to split the cash across each person's loans?
- According to this answer, we receive a tax deduction even when taking a standard deduction.
- There has already been a question about paying off student loans with a lump payment, but that is focused on early payment penalties, which are not relevant in our situation.
