Final answer:
You cannot claim interest on student loans if your income is too high, you are claimed as a dependent, or if your filing status is married filing separately. Interest from loans from related persons or employer plans is also not deductible. Living in student housing and receiving financial aid are not mutually exclusive scenarios.
Step-by-step explanation:
Scenarios in which you cannot claim interest on student loans generally involve situations where the loan does not qualify for tax deductions or the taxpayer's income is above a certain threshold. The ability to claim interest on student loans on your taxes is subject to specific IRS rules. For example, if your modified adjusted gross income (MAGI) is above a certain amount, you may be phased out of claiming the deduction. Moreover, if someone claims you as a dependent on their tax return, you cannot claim the interest deduction on your own return. Furthermore, if your filing status is married filing separately, you are ineligible for the student loan interest deduction.
As for ineligible scenarios, if your loan is from a related person or made under a qualified employer plan, the interest on such a loan would not be deductible. Additionally, to qualify for the deduction, the student loan must have been taken out solely to pay for education expenses, and the expenses must have been incurred during a period when the student was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential.
Regarding the question about student housing and financial aid, living in student housing within five miles of the campus and receiving financial aid are not mutually exclusive scenarios. Students can both live in student housing and receive various types of financial aid, such as grants, scholarships, student loans, or work-study programs, to help cover their educational and living expenses.