Changing the registration in Treasury Direct
Wednesday, September 1st, 2004
Categorized as: Savings Bond registration changes • Treasury Direct
How can I change the registration of TreasuryDirect investments?
(Note: if you want to change the registration on a bond that is marked Restricted Security in TreasuryDirect, see the post What does Restricted Security mean in TreasuryDirect?)
Changing the co-owner or beneficiary: First let's look at how you would change or add a co-owner or beneficiary. Keep in mind that Savings Bond registrations in TreasuryDirect can list one or two people, but not more.
Since it's your TreasuryDirect account, the first name should always be yours. The second name can be anyone you like, but you'll need that person's Social Security Number. You can make the second person either a co-owner or a beneficiary.
Adding or changing a co-owner or beneficary is never a taxable event in TreasuryDirect, but changing the owner of a Savings Bond is, so proceed with caution - especially if you receive a message that your transaction may be taxable.
Changing the registration is a two-step process. First you have to add the new registrations you want to use to your TreasuryDirect Registration List. After that, you can change the registration on a Savings Bond from what it currently is to one of the new registrations in your list.
To add new registrations to your Registration List, log into your TreasuryDirect account and click the Manage Direct tab in the row of buttons across the top of the screen.
On the page that appears, the first section of links is called Manage My Account. One of the links in that section is called Update my Registration List. Use that link to add the new registration that you want to use to your list of registrations.
First click on the correct radio button at the top of the page. Use Sole Owner if the regisration will have only one name, Primary Owner if you want to share ownership with someone else, or Beneficiary if you want the second person to inherit the bond but not share ownership of it with you before your death.
Unless you want to transfer ownership of the bond, which we discuss below, use your own name as the First-Named Registrant and your co-owner or beneficiary as the Second-Named Registrant.
Once you have the registration the way you want it in your list of registrations, return to the Manage Direct page and find the section of links called Manage My Securities. In that section, select the link, Edit a registration.
Next you will be asked to select the Savings Bond you want to change the registration for. A page describing that bond will appear along with a drop-down with your registration list. The bond's current registration will be selected. Change it to the one you really want and click the Add New Registration button.
Changing the owner: There are two different ways to change the owner in TreasuryDirect. One is to move a bond to your Gift Box in someone else's name. The second method transfers the Savings Bond directly to someone else's TreasuryDirect account.
Keep in mind that an ownership transfer will create a taxable event for you - you'll owe income tax on the interest earned by the bond up to the date of the transfer. You'll also set up the recipient for what my book calls the double taxation trap.
To change the owner of one of your Savings Bonds but keep the bond in your own account's Gift Box, follow the procedure given above to create a registration in your Registration List with the new owner's name first. To create a registration without yourself as the first-named registrant, you have to check the This is a gift box at the bottom of the page.
Then, as discussed above, change the registration on one of your bonds to the new one. In this case, you won't be able to change the registration back - a gift is a gift.
The other method of changing the owner is to transfer the Savings Bond to the new owner's TreasuryDirect account. To do this, click on the Manage Direct button, find the section called Manage My Securities and click on Transfer Securities.
On the pages that follow, you will first select the bond you want to transfer, then you'll be able to specify who you want to transfer the bond to. You will need both the recipient's Social Security Number and TreasuryDirect Account Number.