If you cash in bonds and use the proceeds to pay for higher education expenses, you may be able to exclude the bond interest you receive from I or EE bonds on your tax return. You will use Form 8815 to figure the amount of the interest that can be excluded.
Qualifications:
- Issued after 1989
- The bond owner must be 24 years or older when issued.
- To qualify for the college tax exemption, purchase the bonds in your name (not the child’s) or jointly with your spouse.
- The bonds must be redeemed to help pay for college, graduate, or vocational school tuition and fees for the taxpayer, spouse, or dependent, not room and board. If only some proceeds are used to pay for qualified expenses, only that part of the interest can be excluded.
- You cash the qualifying savings bonds in the same tax year you claim the exclusion.
- Not valid on Married Filing Separate returns.
Limits
The exclusion is subject to income limitations:
- Your modified adjusted gross income (AGI) is less than $111,800 if single, head of household, or qualifying surviving spouse.
- Your modified adjusted gross income (AGI) is less than $175,200 if married filing jointly.
What information do I need to claim the exclusion in the program?
To complete the exclusion form in the program, you need the student's name, the higher education institution's name and address, the total amount of qualified expenses paid, the total amount of nontaxable scholarships, the total proceeds from the bonds (principal and interest), and the total interest.
Where to report?
- Federal
- Income (Select my forms)
- 1099-INT, DIV, OID
- Did you earn any interest from Series EE & I US Savings Bonds that you can exclude?
Keep for your records
Keep the following records to verify the interest you exclude.
- Bills, receipts, canceled checks, or other documents showing you paid qualified higher education expenses in 2025.
- A written record of each post-1989 series EE or I bond that you cashed. Your record must include each bond's serial number, issue date, face value, and total redemption proceeds (principal and interest). You can use Form 8818, Optional Form To Record Redemption of Series EE and I U.S. Savings Bonds Issued After 1989, as your written record.