Dissolve yeast in warm water, stirring well; let stand 5 minutes or until bubbly.
Scald milk; add butter, sugar, and salt, stirring until butter melts. Let cool to lukewarm (105° to 115°).
Gradually add 2 cups flour, beating well. Stir in dissolved yeast and egg. Add remaining flour; beat well. Cover and let rise in a warm place (85°), free from drafts, 1 hour or until light and bubbly.
Gently drop mixture by tablespoonfuls into deep hot oil (375°). Cook 1 minute or until golden brown on one side; turn and cook other side. Drain on paper towels. Serve hot with syrup.