When you say the bond "matured the end of 2021', does that mean Dec. 2021 or Jan 2022? A bond that has reached maturity and stopped earning interest is automatically considered redeemed, and the interest amount is to reported to the Internal Revenue Service, that year. If the bond matured in 2021, I'm of the opinion that you do need to file an amended 2021 return to report the interest. Furthermore, it is too late (past 60 days since the bond matured) to roll over the money to a 529 plan.
Q. But I might as well redeem the bonds now and put the money into the 529? Or should I hang onto it until August when tuition is due?
A. It doesn't matter. But, you must put the money into the 529 plan within 60 days of cashing the bonds and do so in the same calendar year. If the bond matured in 2022, I think the 60 days is counted from cashing, not maturity.
Be advised that rolling the money over to a 529 plan is just another way of using the money for education. The same income phase out rules will apply.
You said that "Fall tuition minus scholarship minus $4000 to qualify for AOTC is just a little more than the current value of the bonds (principal and interest), so the bonds could go to tuition". Once the money goes into a 529 plan, withdrawals from the plan can be used for room and board, and still be qualified.
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