Who can claim the deduction for student loan interest if the borrower is a dependent?

When it comes to claiming the deduction for student loan interest, the rules specify that only the student loan borrower can claim it, which often complicates situations with dependents. If the borrower is a dependent, they cannot claim the deduction on their tax return. Instead, the person who paid the student loan interest may be able to claim the deduction, provided they meet certain conditions. In situations where the borrower is still a dependent but has parents or another party making the loan payments, that individual could potentially claim the deduction.

In this case, if Carol is the one who meets these criteria, she is able to claim the deduction for student loan interest, making this answer correct. It emphasizes the importance of understanding the specific rules surrounding tax deductions and the relationship between the borrower and the payer of the student loan interest.