Use U. S. savings bonds for 529 plan

How to use U. S. Savings Bonds to Fund a 529 plan

For qualified U. S. Savings Bonds issued after 1989, interest accrued may be federal income tax exempt, if the U. S. savings bond is redeemed to pay qualified higher education expenses.

For purposes of this tax exclusion, qualified higher education expenses include tuition, contributions to 529 Plans and expenses for certain fees.

In order for you to benefit from the U. S. savings bonds tax exemption, make sure you complete each of these steps:

Note:

Redemption and the deposit of the savings bond redemption proceeds into a Higher Education 529 Fund must occur within the same calendar year.