Pay for Grandsons college tuition with Ibonds

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hoops777
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Joined: Sun Apr 10, 2011 12:23 pm

Pay for Grandsons college tuition with Ibonds

Post by hoops777 » Sun Feb 10, 2019 2:46 pm

I am a bit confused after researching this topic.We have some Ibonds purchased in 2001 that are yielding over 5%.They will mature right before our grandson starts college.They are in our name.We can cash those in and they will be tax free if used for our grandson’s college,correct?We do not need to have them registered in his name or do anything else besides fill out the tax form?
K.I.S.S........so easy to say so difficult to do.

livesoft
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Re: Pay for Grandsons college tuition with Ibonds

Post by livesoft » Sun Feb 10, 2019 2:52 pm

Doesn't work for grandson. It has to be one of your dependents or your spouse. Also there are income limits for folks who do have a child with college education expenses.

See Form 8815.
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Jack FFR1846
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Re: Pay for Grandsons college tuition with Ibonds

Post by Jack FFR1846 » Sun Feb 10, 2019 2:54 pm

Sorry. The tax breaks are only for parents when used for kids college with some income restrictions and other restrictions on their age when bought, how they're titled (parent(s) names ok, kid's name not ok).

Grandparents don't get a tax break.

https://www.foxnews.com/story/saving-th ... -grandkids
is clear on this.

https://www.treasurydirect.gov/indiv/pl ... cation.htm
treasury direct. Not crystal clear, but only says "parents".
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Topic Author
hoops777
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Joined: Sun Apr 10, 2011 12:23 pm

Re: Pay for Grandsons college tuition with Ibonds

Post by hoops777 » Sun Feb 10, 2019 3:05 pm

Oh well....it was a good try.Thanks for the answers.
K.I.S.S........so easy to say so difficult to do.

Topic Author
hoops777
Posts: 2442
Joined: Sun Apr 10, 2011 12:23 pm

Re: Pay for Grandsons college tuition with Ibonds

Post by hoops777 » Sun Feb 10, 2019 3:15 pm

Jack FFR1846 wrote:
Sun Feb 10, 2019 2:54 pm
Sorry. The tax breaks are only for parents when used for kids college with some income restrictions and other restrictions on their age when bought, how they're titled (parent(s) names ok, kid's name not ok).

Grandparents don't get a tax break.

https://www.foxnews.com/story/saving-th ... -grandkids
is clear on this.

https://www.treasurydirect.gov/indiv/pl ... cation.htm
treasury direct. Not crystal clear, but only says "parents".
I just read the article from fox and it had a clever way to get around paying the tax by using a 529 initially set up in my name and then changing it to my grandsons.Probably not worth the hassle and by then I will be 81 and probably more confused than I am now :D
K.I.S.S........so easy to say so difficult to do.

HomeStretch
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Joined: Thu Dec 27, 2018 3:06 pm

Re: Pay for Grandsons college tuition with Ibonds

Post by HomeStretch » Sun Feb 10, 2019 3:24 pm

hoops777 wrote:
Sun Feb 10, 2019 3:15 pm

I just read the article from fox and it had a clever way to get around paying the tax by using a 529 initially set up in my name and then changing it to my grandsons.Probably not worth the hassle and by then I will be 81 and probably more confused than I am now :D
Below is a link to a BH thread discussing this. I thought it was clever too and bookmarked the link.

viewtopic.php?t=258148

Topic Author
hoops777
Posts: 2442
Joined: Sun Apr 10, 2011 12:23 pm

Re: Pay for Grandsons college tuition with Ibonds

Post by hoops777 » Sun Feb 10, 2019 3:42 pm

Thanks
K.I.S.S........so easy to say so difficult to do.

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