Split student loan deduction by spouse

Summary#

The Student Loan Marriage Penalty Elimination Act of 2025 is a bill to amend the Internal Revenue Code of 1986. Its stated goal is to let married couples apply the student loan interest deduction limit separately to each spouse. It has not become law; the bill text was referred to the House Ways and Means Committee.

  • The bill would set a $2,500 limit on student loan interest counted for the deduction for each individual’s debt. It appears intended to let each spouse use a separate limit.
  • It would rewrite the rule that bars deducting the same amount under this section and another part of the tax code.
  • The changes would apply to tax years beginning after December 31, 2024.

What it means for you#

  • Married taxpayers with student loans: The bill appears intended to let spouses count up to $2,500 of interest on each spouse’s debt toward the deduction. The bill does not explain how spouses would allocate or claim the deduction.
  • People with student loans: The bill changes a tax deduction limit. It does not change loan balances, interest rates, repayment terms, or loan forgiveness.
  • Taxpayers generally: The bill does not create a new agency or program. The bill text does not change who is eligible for the deduction or how eligibility is determined.

Money#

No publicly available information on the bill’s fiscal effect.

  • The bill sets a deduction limit, but the materials give no estimate of how it would affect federal tax revenue.
  • The bill does not state a new fee, fine, or direct spending amount.

What is unclear#

  • The current Internal Revenue Code text was not supplied, so the existing limit and how it applies to married couples cannot be verified here.
  • The bill’s wording does not spell out how each spouse’s limit would work on a joint tax return.
  • The bill does not explain how this change would interact with other eligibility rules or limits for the deduction.
  • No cost estimate or implementation details are supplied.

Case for#

  • A separate limit for each spouse could let a married couple deduct interest on each person’s student debt, rather than applying one limit across the couple.
  • The bill keeps a rule against deducting the same amount twice under different parts of the tax code.
  • Applying the change to tax years beginning after 2024 could make the separate limits available for those years if the bill becomes law.

Case against#

  • The bill does not clearly explain how spouses would claim separate limits on a joint return, which could leave taxpayers unsure how to apply it.
  • No estimate shows how much the change could reduce federal tax revenue.
  • Because the current code text and related eligibility rules are not included, it is difficult to assess how many taxpayers would benefit or how the change would interact with existing limits.