Is student loans earned income?

Forum|Forum|6 years ago
June 4, 2019
3 replies
0 views

Since I fully supported myself and child off my student loans and they are non taxable until I start making payments. Do I click yes on that I fully supported myself with earned income.?

TurboTax Free Edition Online

Best answer by NicoleR

You did fully support yourself if you used student loans to pay all of your bills and you are correct they will have to eventually be paid back.

However, student loan income is not taxable nor is it considered earned income for the earned income tax credit.

You may not even be required to fil a tax return although there could be a benefit for you to file based on your specific situation. You could qualify for educational credits depending on if the cost of going to school was covered by scholarships and grants or if it was paid for by student loan proceeds.

NicoleRAnswer

Employee

You did fully support yourself if you used student loans to pay all of your bills and you are correct they will have to eventually be paid back.

However, student loan income is not taxable nor is it considered earned income for the earned income tax credit.

fguilday

Hello, there, this has also been my question. Could not find your answer on IRS site. Could you please share your resource for your answer you posted in 2019?

when determining if parent or student can claim student on 2019 tax return "do unpaid college loans count as support?"

Hal_Al

Employee

Q. Do unpaid college loans count as support?

A. Yes, but not exactly. The receipt of loan money is not support. It's the spending of the loan money that constitutes support. Furthermore, if the parents co-signed the loan, then the support from loans is considered as support coming from the parents; not the student supporting himself.

Reference:

https://www.hrblock.com/tax-center/filing/dependents/student-loans-and-your-dependents/

A separate issue is qualifying for the refundable portion of the American Opportunity credit. That requires not just that the student supports himself. The student must support himself with earned income. Loans and scholarships are not earned income (loans are not any kind of income)

amiyah42003

No.

ehankins279

Student loans are not earned income.