Savings bond interest used for college tuition expenses

[susancao · Accepted solution]

Are you asking about whether you pay taxes on the interest when cashing out savings bonds for post-secondary education? I cashed out some EE bonds that were bought when my now college boy was a baby and we did not have to pay taxes on the interest. - BUT I had to pay the tuition myself as the bond owner, not transferring the money to my son.

I think you only qualify for the full tax break if you are middle income (about $75,000 for singles, $125,000 for married couples), otherwise the tax break disappears if you make too much money.