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Some of these things are probably common knowledge to folks who frequent this forum. They're things I didn't know until a little too late. Hopefully someone else is helped by my sharing.
1. Lifetime Learning Credit. If you get paid during medical school (e.g. research stipend, MBA internship), you can take advantage of the LLC, which is a tax deduction for tuition (or other qualified expenses) payments. I didn't know about this during my first stint of being paid during med school and have been too lazy to ask the IRS for my $500 back.
2. Student Loan Interest Deduction. You can deduct up to the first $2,500 of student loan interest paid each year on your taxes, separate from the standard deduction. This benefit gets phased out for gross incomes between $65,000 and $80,000, so you can't take advantage of it once you're moonlighting significantly or an attending. It's best to know about this early on, as you probably won't be making (required) IBR payments sufficient to max out this benefit during intern/PGY-2 years.
3. Fine print related to forbearance. (I don't have a good link for this.) I was informed by our financial aid office that I need to pay off the interest I accrued during forbearance or my loan would be considered overdue. For some reason, I thought that you just don't pay anything during forbearance and then it capitalizes in the end. That's not a good thing, but if you have to forbear because of doing residency in an expensive location, it's good to know that this is not how things work. It also gives you another reason to at least pay up to the $2,500 to take advantage of the student loan interest deduction.
I'm not a tax professional, I may have something wrong here, so don't take this as advice. Hopefully this was helpful.
1. Lifetime Learning Credit. If you get paid during medical school (e.g. research stipend, MBA internship), you can take advantage of the LLC, which is a tax deduction for tuition (or other qualified expenses) payments. I didn't know about this during my first stint of being paid during med school and have been too lazy to ask the IRS for my $500 back.
2. Student Loan Interest Deduction. You can deduct up to the first $2,500 of student loan interest paid each year on your taxes, separate from the standard deduction. This benefit gets phased out for gross incomes between $65,000 and $80,000, so you can't take advantage of it once you're moonlighting significantly or an attending. It's best to know about this early on, as you probably won't be making (required) IBR payments sufficient to max out this benefit during intern/PGY-2 years.
3. Fine print related to forbearance. (I don't have a good link for this.) I was informed by our financial aid office that I need to pay off the interest I accrued during forbearance or my loan would be considered overdue. For some reason, I thought that you just don't pay anything during forbearance and then it capitalizes in the end. That's not a good thing, but if you have to forbear because of doing residency in an expensive location, it's good to know that this is not how things work. It also gives you another reason to at least pay up to the $2,500 to take advantage of the student loan interest deduction.
I'm not a tax professional, I may have something wrong here, so don't take this as advice. Hopefully this was helpful.
