Problem 5-53 (LO. 2) Starting in 2011, Chuck and Luane have been purchasing Series EE bonds in their name to use for the higher education of their daughter Susie, who currently is age 18. During the year, they cash in $12,000 of the bonds to use for freshman year tuition, fees, and room and board. Of this amount, $5,000 represents interest. Of the $12,000, $8,000 is used for tuition and fees and $4,000 is used for room and board. Chuck and Luane's AGI, before the educational savings bond exclusion, is $132,200. Review 135, and answer the following questions. If an amount is zero, enter "0". a. Chuck and Luane, who will file a joint return, and Susie want to understand the tax consequences. For each statement below, help them by indicating whether the statement is "True" or "False". The Series EE savings bonds qualify as educational savings bonds. The room and board for a dependent qualify as higher education expenses. True False Since the redemption amount exceeds the qualified higher education expenses, only part of the interest qualifies for exclusion. True Chuck and Luane's savings bond exclusion is not subject to any phase-out provision. If Chuck and Luane file a joint, how much is the savings bond exclusion? Round any division to five decimal places. Round your final answer to the nearest dollar. Feedback 3,334 X False Check My Work Congress has attempted to assist low-to middle-income parents in saving for their children's college education. One of the way assists such families is through an interest income exclusion on educational savings bonds. b. Assume that Chuck and Luane purchased the bonds in Susie's name. Determine the tax consequences for Susie. 5,000 of savings bond interest is included in Susie's gross income.