Question

Rodrigo graduated from the University of Maryland in 2016. In 2018, to take advantage of a lower interest rate program, he refinanced his qualified education loans with another qualified student loan. He is not a dependent on another person's tax return. Before AGI limits, what is the maximum deduction available to him for the $3,200 he paid for educational student loan interest in 2018?

Answer 1

$2500

Step-by-step explanation:

So, let us take each of the sentence given in the question one at a time. Thus, we have:

=>" Rodrigo graduated from the University of Maryland in 2016"

COMMENT: Although, the question did not specify whether he used loan to finance his university education from the first statement, it is obvious that he did.

=> "In 2018, to take advantage of a lower interest rate program, he refinanced his qualified education loans with another qualified student loan."

COMMENT: So, he has to take another loan.

=>'' He is not a dependent on another person's tax return.''

COMMENT: Because Rodrigo is not dependent on another person's tax return and the amount of interest paid is $3200, the he has the opportunity if getting a deduction up to $2500.

The tax deduction is a program under the adjustment to income program and it is for the deduction of up to $2500 from taxable income when one takes a student loan