Gerrys student loan balance was $10,000 at the beginning of the year. Total payments on the loan were $2,308, of which $1,768 represented the repayment of the loan principal. How much can Gerry claim as a tax credit with respect to this student loan?

1. $1,500
2. $346
3. $265
4. $81

The answer is $81, and I would like to know the steps to get the answer.