In 2013â, Hubert and Madison purchased Series EEâ bonds, and in 2017 redeemed theâ bonds, receiving $660 of interest and $840 of principal. Their income from other sources totaled $38,000. They paid $2,000 in tuition and fees for their dependent daughter. Their daughter is a qualified student at State University. â(The proceeds from the Series EE bonds were used to pay the tuition andâ fees.)
Exclusionâ phaseouts: Phaseout occurs when the combined amount of principal and interest received during the year exceeds the net qualified educational expenses and theâ taxpayer's modified adjusted gross income is over $78,150 â($117,250 for married individuals filing a jointâ return). The exclusion is fullyâ phased-out for taxpayers whose 2017 modified AGI is more than $93,150 â($147,250 for married individuals filing a jointâ return).
Requirement a. Assuming the daughter received the $3,300 scholarship and that theâ parents' income from other sources is $120,830â, how much of the interest isâ excludable?
In 2013â, Hubert and Madison purchased Series EEâ bonds, and in 2017 redeemed theâ bonds, receiving $660 of interest and $840 of principal. Their income from other sources totaled $38,000. They paid $2,000 in tuition and fees for their dependent daughter. Their daughter is a qualified student at State University. â(The proceeds from the Series EE bonds were used to pay the tuition andâ fees.)
Exclusionâ phaseouts: Phaseout occurs when the combined amount of principal and interest received during the year exceeds the net qualified educational expenses and theâ taxpayer's modified adjusted gross income is over $78,150 â($117,250 for married individuals filing a jointâ return). The exclusion is fullyâ phased-out for taxpayers whose 2017 modified AGI is more than $93,150 â($147,250 for married individuals filing a jointâ return).
Requirement a. Assuming the daughter received the $3,300 scholarship and that theâ parents' income from other sources is $120,830â, how much of the interest isâ excludable?
