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You can report any interest that was actually paid by you on a loan that you are responsible for repaying. You will not report any interest that someone else paid. So, if you made a total of two payments, then you can report the interest associated with those payments. Now, it sounds like you are saying someone paid off the majority of the principal of the loan before you started making payments, so you may need to check your statements to make sure you are only claiming the interest associated with the actual payments you made (i.e the 1098-E that was probably sent may be off because it may included interest not paid by you).
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