Origin: Massachusetts allows two alternative deductions for student loan interest. The first is based on the deduction for student loan interest allowed under the Internal Revenue Code (Code). The Code allows a deduction of up to $2,500 of interest paid on loans used to pay for undergraduate or graduate education, subject to income limitations. The second deduction applies to interest on undergraduate student loans, which is not limited in amount and is not subject to income limitations. Taxpayers cannot take both deductions for the same interest payments.
Origin: M.G.L. c. 62, §§ 2(d)(1), 3B(a)(12); I.R.C. § 62(a)(17), § 221
Tax Type
Tax Expenditure
Item Number
Item Name
Description
Origin
FY2022
FY2023
FY2024
FY2025
FY2026
Personal Income Tax
Deductions from Adjusted Gross Income
1.425
Deduction for Employer Payments of Employee Qualified Education Loans
Massachusetts allows two alternative deductions for student loan interest. The first is based on the deduction for student loan interest allowed under the Internal Revenue Code (Code). The Code allows a deduction of up to $2,500 of interest paid on loans used to pay for undergraduate or graduate education, subject to income limitations. The second deduction applies to interest on undergraduate student loans, which is not limited in amount and is not subject to income limitations. Taxpayers cannot take both deductions for the same interest payments.
M.G.L. c. 62, <a href="https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter62/Section2" target="_blank">§§ 2(d)(1)</a>, <a href="https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter62/Section3b" target="_blank">3B(a)(12)</a>; I.R.C. <a href="https://www.law.cornell.edu/uscode/text/26/62" target="_blank">§ 62(a)(17)</a>, <a href="https://www.law.cornell.edu/uscode/text/26/221" target="_blank">§ 221</a>
16.6
15.6
16.2
16.9
17.5
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