Can I convert my Savings Bonds into tax-free college savings?

In order to roll savings bonds into a 529 plan as a tax-deferred event, for federal tax purposes, the bonds have to meet the following requirements:

  1. Must be a Series EE bond issued after 1989 or a Series I bond.
  2. 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). If the bond is for a child, the child may not be listed as the owner or co-owner – they can be the beneficiary of the bond.
  3. The owner must be 24 years old before the bond's issue date.
  4. The bonds must be used for the owner, the spouse of the owner, or a dependent for whom you can claim an income tax exemption on your federal return. If the grandparent is the owner, they will not qualify unless they can claim the beneficiary.
  5. If married, you must file a joint tax return.
  6. You must meet the following income requirements:
    • Single making less than $72,850
    • Single phases out from $72,850 to $87,850
    • Married making less than $109,250
    • Married phases out from $109,250 to $139,250

For current income limitations and additional information on the Education Savings Bond Program please review IRS Publication 970 (Tax Benefits for Education).

Related Topics

The Pennsylvania 529 College Savings Program sponsors two plans-the Guaranteed Savings Plan (GSP) and the Investment Plan (IP). The guarantee of the PA 529 Guaranteed Savings Plan is an obligation of the GSP Fund, not the Commonwealth of Pennsylvania or any state agency. Before investing in either plan, please carefully read that plan's disclosure to learn more about that plan including investment objectives, risks, fees, and tax implications.