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Example 2. The facts are the same as in Example 1, except that you paid $2,750 interest. Your maximum de- duction for 2022 is $2,500. You must reduce your maxi- mum deduction by $1,250, figured as follows. $2,500 × $160,000 − $145,000 $30,000 = $1,250 In this example, your reduced student loan interest deduc- tion is $1,250 ($2,500 − $1,250). Which Worksheet To Use Generally, you figure the deduction using the Student Loan Interest Deduction Worksheet in the Schedule 1 (Form 1040) instructions included in the Instructions for Form 1040. However, if you are filing Form 2555, Foreign Earned Income; Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa; or you are excluding income from sources within Puerto Rico, you must com- plete Worksheet 4-1. Claiming the Deduction The student loan interest deduction is an adjustment to in- come. To claim the deduction, enter the allowable amount on Schedule 1 (Form 1040), line 21. Student Loan Interest Deduction Worksheet Keep for Your Records Use this worksheet instead of the worksheet in the Schedule 1 (Form 1040) instructions if you are filing Form 2555 or 4563, or you are excluding income from sources within Puerto Rico. Before using this worksheet, you must complete Form 1040 or 1040-SR, line 9, and Schedule 1 (Form 1040), lines 11 through 20, and 23 and 25. 1. Enter the total interest you paid in 2022 on qualified student loans. Don't enter more than $2,500 . . . . . . . . . . . 1.

2. Enter the amount from Form 1040 or 1040-SR, line 9 . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Enter the total of the amounts from Schedule 1 (Form 1040), lines 11 through 20, and 23 and 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Subtract line 3 from line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Enter any foreign earned income exclusion and/or housing exclusion (Schedule 1 (Form 1040), line 8d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Enter any foreign housing deduction (Schedule 1 (Form 1040), line 24j) . . . . . . . . . 6. 7. Enter the amount of income from Puerto Rico you are excluding . . . . . . . . . . . . . . 7. 8. Enter the amount of income from American Samoa you are excluding (Form 4563, line 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. 9. Add lines 4 through 8. This is your modified adjusted gross income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter the amount shown below for your filing status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

• Single, head of household, or qualifying surviving spouse—$70,000 • Married filing jointly—$145,000 11. Is the amount on line 9 more than the amount on line 10? No. Skip lines 11 and 12, enter -0- on line 13, and go to line 14. Yes. Subtract line 10 from line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Divide line 11 by $15,000 ($30,000 if married filing jointly). Enter the result as a decimal (rounded to at least three places). If the result is 1.000 or more, enter 1.000 . . . . . . . . . . . . . . . . . . . . . . . . . . . 12. . 13. Multiply line 1 by line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Student loan interest deduction. Subtract line 13 from line 1. Enter the result here and on Schedule 1 (Form 1040), line 21. Don't include this amount in figuring any other deduction on your return (such as on Schedule A, C, E, etc.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

Worksheet 4-1. Page 36 Chapter 4 Student Loan Interest Deduction