Cassandra is paying the interest on her mother's loan. Who can claim the deduction for student loan interest?

The correct answer is that Cassandra's mother can claim the deduction for student loan interest because the deduction is tied to the individual who is legally obligated to repay the loan. In this case, since the loan is in her mother’s name, she retains the taxpayer responsibility for it. Therefore, even if Cassandra is making the payments, the deduction still belongs to her mother because she is the borrower, and only the borrower can claim the interest deduction for student loans.

The student loan interest deduction allows qualified individuals to deduct up to a certain amount of interest paid on qualified education loans. This deduction is limited to the individual who has incurred the debt. The person who repays the loan payments does not automatically qualify unless they are also the borrower, which is not the case here.

In situations where payment responsibilities are shared or when someone else pays something on behalf of the borrower, it's important to establish who is legally recognized as the borrower for tax purposes. In this scenario, the fact that Cassandra is paying the loan does not grant her the deduction because she is not the one who took out the loan.