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Education Savings Bond Interest Exclusion — Tax Deduction Guide 2026

Exclude interest earned on Series EE or I savings bonds from income when used for qualified higher education expenses, subject to income limits.

$500
Avg Annual Savings
No Limit
Max Deduction
Above-the-Line
Deduction Type
Form 8815, Form 1040
Tax Forms

Eligibility

Taxpayers who cash Series EE or I bonds for qualified education expenses

Tax Savings Calculator

$

Estimated Tax Savings

$1,100

At the 22% tax bracket, a $5,000 deduction saves you $1,100 in taxes.

Savings by Tax Bracket

10%
$227
12%
$273
22%
$500
24%
$545
32%
$727
35%
$795
37%
$841

Requirements

  • 1Bonds must be Series EE or I issued after 1989
  • 2Owner must be at least 24 when bond was issued
  • 3Used for qualified higher education expenses
  • 4Income phase-outs apply

Common Mistakes to Avoid

  • !Buying bonds in child's name instead of parent's
  • !Not meeting the age requirement at issuance
  • !Exceeding income limits for the exclusion

Required Tax Forms

Form 8815Form 1040

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Frequently Asked Questions

What is the Education Savings Bond Interest Exclusion?

Exclude interest earned on Series EE or I savings bonds from income when used for qualified higher education expenses, subject to income limits.

Who is eligible for the Education Savings Bond Interest Exclusion?

Taxpayers who cash Series EE or I bonds for qualified education expenses

How much can I save with the Education Savings Bond Interest Exclusion?

The average tax savings is $500 per year. Your actual savings depend on your tax bracket and qualifying amount.

What forms do I need for the Education Savings Bond Interest Exclusion?

You'll need to file Form 8815 and Form 1040 to claim this deduction.

What are common mistakes with the Education Savings Bond Interest Exclusion?

Common mistakes include: Buying bonds in child's name instead of parent's; Not meeting the age requirement at issuance; Exceeding income limits for the exclusion. Always double-check requirements before filing.

Is the Education Savings Bond Interest Exclusion worth claiming?

With average savings of $500, the education savings bond interest exclusion is a helpful addition to your tax strategy. Make sure you meet all eligibility requirements.

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