It depends. Only the interest on EE and I bonds issued after December 31, 1989 may be tax-exempt if used to pay for certain educational expenses (explained below). When you enter your 1099-INT, TurboTax will ask you about the type of US bond and education qualifications.
For 2024, the amount of your education savings bond interest exclusion is gradually reduced (phased out) if your MAGI is between $96,800 and $111,800 ($145,200 and $175,200 if you file a joint return). You can't exclude any of the interest if your MAGI is $111,800 or more ($175,200 or more if you file a joint return). See IRS Publication 970 for more information, details about the bonds and education are noted below.
Qualified U.S. savings bonds.
- A qualified U.S. savings bond is a series EE bond issued after 1989 or a series I bond. The bond must be issued either in your name (as the sole owner) or in the name of both you and your spouse (as co-owners).
- The owner must be at least 24 years old before the bond's issue date. The issue date is printed in the upper right corner of a paper bond and shown in Treasury Direct for an electronic bond.
Qualified education expenses.
- These include the following items you pay for either yourself, your spouse, or a dependent.
- Tuition and fees required to enroll at or attend an eligible educational institution. Qualified education expenses don't include expenses for room and board or for courses involving sports, games, or hobbies that aren't part of a degree or certificate-granting program.
- Contributions to a qualified tuition program (QTP) (see How Much Can You Contribute in chapter 7).
- Contributions to a Coverdell education savings account (ESA) (see Contributions in chapter 6).
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