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Anonymous
Not applicable

Is my son eligible for the education exclusion for a EE savings bond that was cashed where he was the beneficiary and not the bond owner?

My son's grandmother (who has passed) purchased a EE savings bond in 1997 and made my son the beneficiary.  The bond was cashed last year (2018) and used to help pay for his college expenses.  The interest on the bond currently shows up in his tax return as interest income.  I don't see anywhere in the return where any of this income is excluded. I believe all the following qualifying rules are met.

1. The EE bond was issued after 1989.

2. The owner of the bond (his grandmother) was older than 24 when she purchased the bond.

3. The education costs were paid in the same year the bond was redeemed.

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1 Reply
Hal_Al
Level 15

Is my son eligible for the education exclusion for a EE savings bond that was cashed where he was the beneficiary and not the bond owner?

No, those bonds are not eligible, because they were not purchased in his name.  "You must be at least 24 years old on the first day of the month in which YOU bought the bond(s)."

Reference: https://www.treasurydirect.gov/indiv/planning/plan_education.htm

Had grandmother lived, she also would not have been eligible, because her grandson was not her dependent.

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