Form 8815
Response to the following problem:
Michael J. Dugan (SSN 372-90-6729) received $15,000 ($12,000 principal and $3,000 interest) from the redemption of a Series EE U.S. Savings Bond. He used the proceeds to pay university tuition and fees totaling $8,250 for his two dependent children, Colleen R. Dugan and Patrick T. Dugan. Colleen is 21 years of age; Patrick is 20. With the exception of temporary absences from home to attend the University of Michigan in Ann Arbor, MI 48104 full-time, they live with their parents. During the year, Colleen and Patrick each received a tax-exempt university scholarship of $2,250. Michael's salary is $123,700. The salary and interest from the bonds are Michael and Rachel Dugans' only sources of income. Prepare Form 8815 to be attached to the Dugans' 2014 joint tax return.