Redeming EE bonds
CAN EE US BONDS be used to pay off a grandchild college dept without incuring a taxable event
Terry Says
No, that was a long-ago privilege for PARENTS to pay for college expenses — and not even to repay college debt. And that program was designed at the time for “middle income” families.
If your EE bonds have matured, you’ll need to cash them in — and report all the income on that year’s Federal tax return. That income might push you into a higher tax bracket, or even a higher Medicare Part B payment cost. So you might cash then in over a two-year period to spread out the tax hit. Discuss the possibilities with your CPA.
Enjoy reading this brochure from the Treasury Department about cashing in savings bonds.
