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Thread: Student loan payments showing income?

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    Moderator Miss_McKenna's Avatar
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    Dizzy Student loan payments showing income?

    First of all, I wanna say how appreciative I am of this thread! When I first joined SW I thought Dollar Den was the boring economy area, but now that I've started reading up on taxes and payments and such for this year, I'm so grateful we have this! I've learned so much about where the economy is headed, how to manage my money etc, really valuable stuff!!

    I was wondering if anyone could help me with a question I have about student loans. My loans are private loans from the bank, not related to the government or financial aid or anything (I'm not eligible for financial aid). If I were to take my nights earnings from dancing, say $200-$300, and go into the bank and put it directly towards my loans, would the IRS see it as income, and know it was from me? My parents have also paid some small amounts to my loan in the past and I don't know how the IRS would be able to tell who paid it back, as its a deposit. On the other hand, would they see all repayments as being income for me, whether I was the one paying into the loan or not? I'd hate for them to attribute all payments to me, when I wasn't the one making them all.


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    Banned Melonie's Avatar
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    Default Re: Student loan payments showing income?

    The official answer to your question is ... yes ... any income you earned from dancing is considered to be taxable income by the IRS.

    The answer to the question you are not directly asking probably goes as follows ...

    - while Sallie Mae and other gov't grant/loan agencies automatically share information with the IRS, similar automatic reportings do NOT exist for 'private sector' loans ... which would seem to apply in regard to your particular student loan situation. Obviously, the private sector bank would have to provide the IRS with your transaction history if the IRS requested that info, but it would not be provided automatically.

    However, there is also an issue of 'suspicious activity' reports having to be generated to the IRS by bank employees who notice a suspicious 'pattern' of transactions by a customer - where somebody walking in several days per week to make $200 loan payments might very well draw such attention. Similarly, there is an automatic cash transaction reporting requirement to the IRS if a customer makes any single transaction that exceeds $3000 in cash ( and as low as $1000 in some states ).

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    Default Re: Student loan payments showing income?

    As far as the "who will they attribute the payments to" thing, if you are the one walking into the bank with the money regardless of where you get it from, parents or found in the road after it fell out of a Brinks truck the assumption will be it is your money.

    Can your parents or whoever walk into the bank and pay money on your loan? I would guess and say no.

    If your parents claim these payments as "gifts" on there taxes AND you claim getting them on your taxes that would be a way out of it.

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