Posts Tagged ‘savings bonds education’
Savings Bonds for Education
May 14th, 2009
Using Savings Bonds for education with Educational IRA s and 529 plans
- How much of your college savings is in the form of U.S. Savings Bonds?
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While earnings on qualified U.S. Savings Bonds are tax exempt if the US Savings Bonds are redeemed to pay for qualified higher ducation expenses will the interest rate on a U.S. Savings Bond keep up with the rising costs of college?
If you are concerned that college costs will outpace the returns of U.S. Savings Bonds, consider this:
Redeem qualified U.S. Savings Bonds and deposit the proceeds from the Savings Bonds into a Higher Education 529 Fund account.
You can redeem qualified US Savings Bonds for education tax free.
Who is Eligible to redeem US Savings Bonds for education tax free?
- Owner of the US savings bond must be at least 24 years old before the date of issuance of the savings bond.
- Owner of the savings bond must meet the required adjusted gross income (AGI) thresholds below. These thresholds are indexed yearly for inflation.
Modified adjusted gross income (AGI) Thresholds for Tax Free Redemptions of Series EE US Savings Bonds
| Filing Status | Full | Pro Rata Phaseout | None |
|---|---|---|---|
| Joint | Under $89,750 | $89,750-$119,750 | Over $119,750 |
| Single | Under $59,850 | $ 59,850-$74,850 | Over $74,850 |
Posted in Savings Bonds for Education | 
Tags: education, Savings Bonds, savings bonds education, us savings bond | 
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Savings Bonds Education
September 18th, 2006
Question: Cashed Savings Bonds taxed as income if I used it for tuition?
In May 2006 I cashed in about $950 worth of Savings Bonds some family gave me when I was young (27-30 years ago).
I took this money and put it in my checking account and immediately used the proceeds (and then some…) to pay off my outstanding college tuition bill.
Do I need to pay income taxes on this amount? Because the bank sent me an income statement for the $950 and the school has sent me nothing. I know that higher education tuition is normally tax deductible for an unlimited number of years, which is different than when I first started college.
Thanks!
Answer: You will have to pay the interest on the Savings Bonds because you can not exclude them for FEDERAL taxes because you were under 24 when they were issued to you. However, you can write off some of the school expenses (tuition and fees) with either a Hope Credit, Lifetime Learning Credit, or Tuition and Fees Deduction.
You should not report the bond interest on your state tax return.
DISCOVERY EDUCATION AND 3M ANNOUNCE NATIONAL SCIENCE WINNER