The taxpayer can exclude interest income from Series EE and Series I US Savings bonds if all of the following are true:
- The bonds were issued after 1989;
- The person in whose name the bonds were issued was age 24 or older before they were issued;
- The bonds were cashed in during the during tax year;
- The taxpayer paid qualified higher education expenses;
- The filing status on the return is not MFS;
- Modified AGI is less than a threshold for the taxpayer's filing status. The modified AGI thresholds change annually - see the Form 8815 instructions for the current year's thresholds.
To complete Form 8815 you will need to enter all the taxpayer's 1099-INTs (and 1099-DIVs) individually in the tax return, i.e., you can't summarize them if the total of each is under $1,500. See here for more information about entering Form 1099-INT in ProWeb.
Once all the interest has been entered in the return, complete Form 8815. From the Federal Section of the tax return select:
- Income
- Schedule B - Forms 1099-INT, DIV, OID
- Exclusion of Interest from Series EE & I US Savings Bonds
- Enter the student's name and the name and address of the qualified educational institution they attended. If there is more than one student, click the blue SAVE & ENTER ANOTHER button, otherwise click the blue CONTINUE button.
- In the Form 8815 Expenses menu, enter the information the form needs to calculate the exclusion:
- Total amount you paid for qualified higher education expenses - Enter the amount of qualified education expenses. These include tuition and fees. They don't include room and board, nor fees for sports or games unrelated to the student's degree program. They also don't include (a) expenses covered by nontaxable benefits paid to or by the institution, (b) expenses used in calculating an education credit on Form 8863, or (c) expenses used to calculate the nontaxable amount of a distribution from a Coverdell ESA or a QTP.
- Total of all nontaxable educational benefits that you received - Enter the amount of qualified education expenses included in the previous entry that were covered by nontaxable educational benefits paid directly to the student. (As with the previous entry, don't include nontaxable benefits paid to or by the institution.)
- Total proceeds from all series EE and I US savings bonds issued after 1989 - Enter total amount, principal plus interest, received from Series EE and Series I bonds cashed in during the year.
- Amount of "Total proceeds" (above) that is from interest - Enter the portion of the amount received that is interest.
When finished with your entries, click the blue CONTINUE button.
Note: This is a guide to completing Form 8815 in TaxSlayer ProWeb. It is not intended as tax advice.