Can I exclude interest on Bonds utilized to pay for educational expenses?
Since 1990, the Series EE US Savings Bonds have had an added feature that will allow owners to entirely exclude interest accrued on the bonds if used to pay for qualified educational expenses. There are four basic restrictions to the qualified Savings Bond exclusion program. First, the exclusion is available only for bonds purchased on or after January 1, 1990. Bonds purchased before this date will not qualify. Secondly, the bond must be issued to an individual who is at least 24 years old. Third, the exclusion is phased out as the adjusted gross income of the taxpayer exceeds certain levels depending on the owner’s filing status. The final requirement is that the amount of the interest on the redeemed bonds must be lower than qualified higher educational expenses of the child, the taxpayer, or a spouse. The limits are higher since 2000 for the exclusion of interest from income for Series EE Savings Bonds used for education. The ability to exclude interest from savings bonds used for e
