26 U.S.C. § 135
Income from United States savings bonds used to pay higher education tuition and fees
In the case of an individual who pays qualified higher education expenses during the taxable year, no amount shall be includible in gross income by reason of the redemption during such year of any qualified United States savings bond.
For purposes of subparagraph (A), the term “applicable fraction” means the fraction the numerator of which is the amount described in subparagraph (A)(ii) and the denominator of which is the amount described in subparagraph (A)(i).
If the modified adjusted gross income of the taxpayer for the taxable year exceeds $40,000 ($60,000 in the case of a joint return), the amount which would (but for this paragraph) be excludable from gross income under subsection (a) shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which would be so excludable as such excess bears to $15,000 ($30,000 in the case of a joint return).
If any amount as adjusted under subparagraph (B) is not a multiple of $50, such amount shall be rounded to the nearest multiple of $50 (or if such amount is a multiple of $25, such amount shall be rounded to the next highest multiple of $50).
Such term shall not include expenses with respect to any course or other education involving sports, games, or hobbies other than as part of a degree program.
Such term shall include any contribution to a qualified tuition program (as defined in section 529) on behalf of a designated beneficiary (as defined in such section), or to a Coverdell education savings account (as defined in section 530) on behalf of an account beneficiary, who is an individual described in subparagraph (A); but there shall be no increase in the investment in the contract for purposes of applying section 72 by reason of any portion of such contribution which is not includible in gross income by reason of this subparagraph.
The term “eligible educational institution” has the meaning given such term by section 529(e)(5).
If the taxpayer is a married individual (within the meaning of section 7703), this section shall apply only if the taxpayer and his spouse file a joint return for the taxable year.
The Secretary may prescribe such regulations as may be necessary or appropriate to carry out this section, including regulations requiring record keeping and information reporting.
For inflation adjustment of certain items in this section, see Revenue Procedures listed in a table under section 1 of this title.
A prior section 135 was renumbered section 140 of this title.
2021—Subsec. (c)(4)(A). Pub. L. 117–2 inserted “85(c),” before “137”.
2020—Subsec. (c)(4)(A). Pub. L. 116–260 struck out “222,” after “221,”.
2017—Subsec. (b)(2)(B)(ii). Pub. L. 115–97, § 11002(d)(1)(M), substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)”.
Subsec. (c)(4)(A). Pub. L. 115–97, § 13305(b)(1), struck out “199,” before “221”.
2004—Subsec. (c)(4)(A). Pub. L. 108–357 inserted “199,” before “221”.
2001—Subsec. (c)(2)(C). Pub. L. 107–22, in heading substituted “Coverdell education savings” for “education individual retirement” and in text substituted “a Coverdell education savings” for “an education individual retirement”.
Pub. L. 107–16, § 402(a)(4)(A), (B), substituted “qualified tuition” for “qualified State tuition” in heading and text.
Subsec. (c)(4)(A). Pub. L. 107–16, § 431(c)(1), inserted “222,” after “221,”.
Subsec. (d)(1)(D). Pub. L. 107–16, § 402(a)(4)(A), substituted “qualified tuition” for “qualified State tuition”.
Subsec. (d)(2)(A). Pub. L. 107–16, § 401(g)(2)(B), substituted “allowed” for “allowable”.
Subsec. (d)(2)(B). Pub. L. 107–16, § 402(b)(2)(A), substituted “the exclusions under sections 529(c)(3)(B) and 530(d)(2)” for “the exclusion under section 530(d)(2)”.
1998—Subsec. (c)(2)(C). Pub. L. 105–206, § 6004(d)(9), inserted “and education individual retirement accounts” after “program” in heading and substituted “section 72” for “section 529(c)(3)(A)” in text.
Subsec. (c)(3). Pub. L. 105–206, § 6004(c)(1), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “The term ‘eligible educational institution’ means—
“(A) an institution described in section 1201(a) or subparagraph (C) or (D) of section 481(a)(1) of the Higher Education Act of 1965 (as in effect on
“(B) an area vocational education school (as defined in subparagraph (C) or (D) of section 521(3) of the Carl D. Perkins Vocational Education Act) which is in any State (as defined in section 521(27) of such Act), as such sections are in effect on
Subsec. (c)(4)(A). Pub. L. 105–277 inserted “221,” after “137,”.
Subsec. (d)(2). Pub. L. 105–206, § 6004(d)(4), substituted “other higher education benefits” for “higher education credit” in heading and amended text of par. (2) generally. Prior to amendment, text read as follows: “The amount of the qualified higher education expenses otherwise taken into account under subsection (a) with respect to the education of an individual shall be reduced (before the application of subsection (b)) by the amount of such expenses which are taken into account in determining the credit allowable to the taxpayer or any other person under section 25A with respect to such expenses.”
1997—Subsec. (c)(2)(C). Pub. L. 105–34, § 213(e)(2), inserted “, or to an education individual retirement account (as defined in section 530) on behalf of an account beneficiary,” after “(as defined in such section)”.
Pub. L. 105–34, § 211(c), added subpar. (C).
Subsec. (d)(2) to (4). Pub. L. 105–34, § 201(d), added par. (2) and redesignated former pars. (2) and (3) as (3) and (4), respectively.
1996—Subsec. (b)(2)(B)(ii). Pub. L. 104–188, § 1703(d), inserted “, determined by substituting ‘calendar year 1989’ for ‘calendar year 1992’ in subparagraph (B) thereof” before period at end.
Subsec. (c)(4)(A). Pub. L. 104–188, § 1807(c)(2), inserted “137,” before “911”.
Subsec. (d)(1)(D). Pub. L. 104–188, § 1806(b)(1), added subpar. (D).
1990—Subsec. (b)(2)(B). Pub. L. 101–508, § 11702(h)(1), substituted “the $40,000 and $60,000 amounts” for “each dollar amount” in introductory provisions.
Subsec. (b)(2)(B)(ii). Pub. L. 101–508, § 11101(d)(1)(E), struck out before period at end “, determined by substituting ‘calendar year 1989’ for ‘calendar year 1987’ in subparagraph (B) thereof”.
Subsec. (b)(2)(C). Pub. L. 101–508, § 11702(h)(2), struck out “(A) or” after “subparagraph”.
1989—Subsec. (d)(1). Pub. L. 101–239 substituted “subsection (a) with respect to” for “subsection (a) respect to”.
Amendment by Pub. L. 117–2 applicable to taxable years beginning after
Amendment by Pub. L. 116–260 applicable to taxable years beginning after
Amendment by section 11002(d)(1)(M) of Pub. L. 115–97 applicable to taxable years beginning after
Amendment by section 13305(b)(1) of Pub. L. 115–97 applicable to taxable years beginning after
Amendment by Pub. L. 108–357 applicable to taxable years beginning after
Amendment by Pub. L. 107–22 effective
Amendment by section 401(g)(2)(B) of Pub. L. 107–16 applicable to taxable years beginning after
Amendment by section 402(a)(4)(A), (B), (b)(2)(A) of Pub. L. 107–16 applicable to taxable years beginning after
Amendment by section 431(c)(1) of Pub. L. 107–16 applicable to payments made in taxable years beginning after
Amendment by Pub. L. 105–277 effective as if included in the provision of the Taxpayer Relief Act of 1997, Pub. L. 105–34, to which such amendment relates, see section 4003(l) of Pub. L. 105–277, set out as a note under section 86 of this title.
Amendment by Pub. L. 105–206 effective, except as otherwise provided, as if included in the provisions of the Taxpayer Relief Act of 1997, Pub. L. 105–34, to which such amendment relates, see section 6024 of Pub. L. 105–206, set out as a note under section 1 of this title.
Amendment by section 201(d) of Pub. L. 105–34 applicable to expenses paid after
Amendment by section 211(c) of Pub. L. 105–34 applicable to taxable years beginning after
Amendment by section 213(e)(2) of Pub. L. 105–34 applicable to taxable years beginning after
Amendment by section 1703(d) of Pub. L. 104–188 effective as if included in the provision of the Revenue Reconciliation Act of 1993, Pub. L. 103–66, §§ 13001–13444, to which such amendment relates, see section 1703(o) of Pub. L. 104–188, set out as a note under section 39 of this title.
Amendment by section 1806(b)(1) of Pub. L. 104–188 applicable to taxable years ending after
Amendment by section 1807(c)(2) of Pub. L. 104–188 applicable to taxable years beginning after
Amendment by section 11101(d)(1)(E) of Pub. L. 101–508 applicable to taxable years beginning after
Amendment by section 11702(h) of Pub. L. 101–508 effective as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 11702(j) of Pub. L. 101–508, set out as a note under section 59 of this title.
Amendment by Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 7817 of Pub. L. 101–239, set out as a note under section 1 of this title.
Section applicable to taxable years beginning after
Pub. L. 100–647, title VI, § 6009(b),
Pub. L. 100–647, title VI, § 6009(e),