How to cash in a savings bond

Clear and precise information.

Hi: I had a problem cashing some IBonds at the local bank that I'd like to share with you: The bonds we have are issued to my wife and I which are in our Revocable Living Trust. The registration of the trust (and what it says on the Bonds) is as follows: (I'll of course use fake names here)…

John Smith and Mary Smith Revocable Trust dated 01-01-2003. Note that the word "and" appears between the names. Our Revocable Trust is also named the same way. I was not allowed to cash the bonds by myself, but will also have to have my wife sign them at the same time. That part is of course is not a problem as it just means another trip to the bank. The problem becomes more accute if one of us dies and the other wants to cash the bonds. The bank called the Federal Reserve to inquire about how to handle this and she was told that we both have to sign the bonds, and if one of us is deceased, the bank can't really handle it for us any longer. The bonds have to be mailed to the Federal Reserve with a signature guarantee and a copy of the Trust in order for the bonds to be cashed. Question is: All of our bonds are registered in this way and I was only cashing in part of them. Should I try and get the bonds reissued in some way, or cash them all in and forget it about it. If I should die first then my wife will have a big headache dealing with all this and I'm trying to keep things simple. Or, is there a better way to register any new bonds that wouldn't involve the requirement that we both need to sign? Thanks!

Dan - it's the word "and" in "John Smith and Mary Smith" that's requiring two signatures. If it said "or," then only one signature would be required.

But what's on the Savings Bond has to match what's on the Trust documents, so to get this fixed at this point would require changing the trust as well as the Savings Bonds.

On the other hand, the death of a spouse is never simple for the surviving spouse, no matter what you do. Should you die and your wife need to cash the bonds, she will be able to do so by providing a copy of your death certificate.

Tom Adams

Tom : when it comes to redeeming savings bonds, there ain't nothing better than a Treasury Direct account.

Thanks to your website, I finally got smart enough to convert my paper EE and I bonds into a TD account. Redeeming the bonds was done completely on-line and sent by EFT straight to my checking account within 24 hours. There's no hassling with banks and all the limitations that they impose.

You are providing a terrific education for investors here.

I have Savings Bonds in my grandchildren's names. They are minors. How do I cash them in for my grandchildren who need the money now?

Hi Brenda - as the grandparent, you can't cash these bonds, even if you put up the money. However, a custodial parent can sign for a minor child, so you can have the bonds cashed that way.

Tom Adams

My daughter wants to cash in some of here bonds, she is 16 and married lives in another state. Can she cash them herself or does she need one of her parents to cash them for her.

Hi Dennis - Many banks will allow a 16-year-old with photo ID to redeem their own Savings Bonds, but not all will. It depends entirely on the bank, so there's no way to tell what her experience will be.

Tom Adams

I am the executor of an estate. I have letters testamentary and one death certificate and about 270 E and EE bonds. I also have a 6 page excel worksheet with serial numbers, issue dates and face amounts. Do i have to copy each entry to the signature guarantee form or can I attach the excel worksheets to the submission form?

if both owners of the savings bond have died, are they still valid?

Joe - You can attach copies of the Excel worksheets. In the space on the form for listing bonds, just write "see attached".

Justin - the bonds are still valid and belong to the heirs of the person who died last. Getting the name changed involves filing a form. There are different forms depending on whether the estate is probated or not. My book has details.

Tom Adams

Tom, I have series E bonds that will soon no longer earn interest after 30 years and should be redeemed. Although the face of the bond indicates that the issue date is the "first day" of the month (and year), what is the actual day of the month (first or last calendar day or is it business day) when interest on the bond will no longer accrue? In effect, what is the appropriate day within a month to redeem a bond in its 30th year? I don't want to lose any interest in that "last" month by prematurely redeeming the bond. An example would be appreciated.

Tom,

Can you please respond to the question by Bob Anderson on Jan 4? I have a savings EE bond that matured on 1/1/08 after 30 years and need to know when to redeem it w/o missing any interest payments. Thanks.

Bob and John - the last interest payment is credited on the first business day of the month of issue.

So if the bond was purchased on any day in January 1978, you can cash it on the first business day of January 2008 and get the full amount of interest.

Tom Adams

Tom: Do you have to be 18 to cash a bond? My son (17) cashed in his (without my knowing) and I have received tax information for these bonds that was reported to the IRS .I was surprised he was able to cash them in since he is a minor. He did not work last year so has no income to claim. Do we need to file a tax return for these bonds that he foolishly cashed in? Thank you.

Mary - there is no age limit to cashing a Savings Bond. Whether your son needs to file a tax return or not depends on whether his total unearned income (Savings Bond interest and other investment income) is more or less than $850. IRS Publication 17 has the details on pages 5 to 8.

Tom Adams

what form(s) of ID are required when redeeming bonds?

H - each bank sets its own ID policies, so you'll have to call ahead and ask. But typically if you have an account at the bank it requires no more than one photo ID.

Tom Adams

How much do the banks charge for cashing in I Series Savings Bonds? Does the Federal Reserve give them guidelines in how much they can charge?

M. Kring - yes, the Treasury gives banks clear and precise guidelines on how much they can charge - nothing. The Treasury is already paying them; they aren't supposed to charge you, too.

If a bank charges you a fee to redeem Savings Bonds, use the link on this page to contact the Treasury and report the bank and the amount to them. Ask to be reimbursed.

Tom Adams

My son signed the back of his savings bonds and I took them to our credit union for redemption. I thought the 1099 would go to my son, but the credit union sent it to me and insists that this is correct since I am the one that brought them to the credit union. They asked me to sign a form which I thought was a receipt for the bonds, but it turns out that this is what they used to prepare the 1099. They insist that the interest be reported by me…what can I do?

Hi Luanne - Unless you son's bonds were worth a lot of money, the cheapest thing to do is probably to just pay the tax. If the tax amount is so high it's worth avoiding it, consult your tax advisor or my book; the pertinent information concerns "nominee distributions." But it's complicated and only works if legally your son owes the tax, not you. See this post for more information.

Tom Adam

my dad has a couple of matured savings bonds that he wants to sign over, one each to each one of my sons. how do we go about doing that?

thanks.

— tom shymanski

Hi Tom - that's not possible. He has to cash the bonds, hold back what he needs for taxes, and give your sons the remaining money.

Tom Adams

my clients died, owning $30,000 worth of E and EE bonds from 1979 to 1991. how do we redeem them? they died testate, with pour over will and living trust, but bonds vested just in their name only

Hi James - my book has answers to the question you're asking (as well as several others you haven't thought of yet). Amazon can ship it to you next day if necessary. Scroll up and click on the "Buy from Amazon" button on the right.

Tom Adams

Question #1- can savings bonds be reissued to (children) beneficiaries without being cashed in?

Question #2- can double b bonds be reissued without converting to h bonds? Thank you

Dina -

1.) Yes, you can have the registration changed but you will owe tax on the interest the bond has earned to date. See this post.

2.) HH bonds were discontinued in 2004 and there's no such thing as double-b bonds, but I think you're asking if the name can be changed on a Savings Bond and the answer is yes.

Tom Adams

Tom - Thank you for the answers to my questions. In regards to my #1 question, what if both co-owners are deceased? Thank you in advance.

Dina - if both co-owners are deceased, the executor of the estate of the person who died last can have names on the bond changed without triggering income taxes on the interest. But this is more complicated. See this post.

Also, I may have misunderstood your first question. If you mean the beneficiary is named on the bond (I understood you to mean the new name wasn't already on the bond) then see this post.

Tom Adams

My children each have savings bond's in their name and co-owned by their grandmother. Their grandmother has since passed away and the bonds were given to me to keep for them. I would like to cash them in for my minor children. How do I go about doing that?

Teresa - just follow the instructions at the top of this page. As long as the children live with you, you may sign for them as a custodial parent.

Since the children are co-owners (OR appears between the child's name and the grandmother's name rather than POD) you don't need the grandmother's death certificate. If it's actually POD and the grandmother's name is first, then you do need her death certificate.

Tom Adams

hello i was recently told that i have 3 savings bonds out in my name it started since i was born now im 27 but the only problem is that my family can`t locate them what do i do because i never seen them

Simario - follow the instructions on my page about lost savings bonds.

Tom Adams

Hi Tom,

I purchased some old bonds from a man who was settling his recently deceased 90 year old father’s estate. At the sale the man seemed like he could not have cared less about the pictures, paper and bonds his father had, in short they had lots of money. The (1927 or 1947) bonds are not in his fathers or mothers name, they are in the name of a blood relative of the father who I suspect was an aunt, mother or sister that is probably now deceased too. My question is since I purchased these from his estate can I legally cash them if they still have value and have not been transferred or cashed in already?

Thanks, Cass

Cass - if these are US Savings Bonds, no. Only the person named on the bonds or her heirs can cash them.

If they are some other kind of bond, then maybe, but you'll have to track that down elsewhere, as I only cover US Savings Bonds.

Tom Adams

I inherited my Grandmothers estate and have recently discovered several 50+ year old savings bonds which are not registered in her name, can I cash them?

James - No, you can't. If you can't find the person named on the bonds or the heirs, see the information here.

Tom Adams

Hi Tom,

We have several series EE savings bonds in my daughter's name with my wife as co-owner. I as her father wanted to cash them in. My daughter is a minor 15, and my wife is not always around to cash them, do I need my wife to cash them or can I as a custodial parent cash them?

Hi Mike - Most banks will let a 15-year old accompanied by a custodial parent sign the bonds herself. If the bank refuses, then you can sign for her.

But if you try to cash them without either your daughter or your wife present, I think you'll meet some resistance.

Tom Adams

Hello, We have three children all under the age of fifteen who have savings bonds… we want to go ahead and cash them and open a checking account for each of them. Some have my name on them below the kids and some have my husbands name on them below he kids….because my husband is at work from seven until many times eight at night due to the crap economy is there any way that he can sign them and give me his license and or social security card and have the money deposited into our joint account?

Marie - Only the first person named on the bond has to sign it, not both.

In all likelihood, the bank will let your kids sign their own bonds. If not, they will allow you to sign the bonds for the kids as their parent.

Your husband doesn't need to be involved at all.

Tom Adams

My wife discovered a $400 worth of savings bond her mother purchased in 1973. The bonds have her mother's name on them but she died in 1995. She has a copy of her mother's death certificate.
Is there anything else she needs before she brings them to Washington Mutual for cashing?

Hi David - your wife would also need to provide evidence that she is her mother's only heir.

There are different forms for this, depending on whether the mother's estate was handled by a court, by state small-estate law, or not legally handled at all.

Wamu may have the form your wife needs and if they do you should thank them profusely because most banks have no idea what to do in this situation.

Of course if she's not the only heir - for example, if she had living brothers or sisters when her mother died, or if her mother was married when she died, it quickly gets very complicated.

Tom Adams

MY X-HUSBAND PASSED AWAY RECENTLY. WE HAD SAVINGS BONDS AND I WAS A C0-OWNER. IS THERE ANYWAY, ANYONE ELSE CAN CASH THEM IN. THE EXECUTOR OF HIS ESTATE SEEMS TO THINK HE CAN. I THINK THAT I AM THE ONLY ONE THAT CAN. PLEASE LET ME KNOW IF THERE IS A WAY THE EXECUTOR CAN. THANKS DEB

hello,
my father recently died and had been saving several bonds for me, but with no beneficiary listed. can i transfer these to my name to let them mature or am i going to have to just say so long to them?

Deb - Legally you are the only one who can cash the bond. The estate has no property rights in the bond. However, that's not to say the Executor can't get a friendly banker to cash it anyhow. If it's a large amount, you might want to hire a lawyer of your own to let the Executor know that if your bonds were cashed you would consider it to be fraud.

Amanda - since your father died without a beneficiary listed, the bonds now belong to his heirs. If you're the only heir, the money is yours, but you have to prove that you're the only heir. Normally this is done through a probate court, but there are other ways if his estate (his property) was too small for that.

Tom Adams

How and where do I cash in HH bonds? No more interest will be given at the end of this year.

Jeff - the info you're looking for is here.

Tom Adams

I got some EE bonds , I've been buying every month for 5 years, I want to cash in about 4 hundred dollars worth, Now the question is does my bank report to the IRS that I cashed them, and do I pay taxes on cashing them with the very little interest on them, the bank can keep the interest.

Eric - the bank reports the amount of interest you've earned to you and the IRS using a form called a 1099-INT. You then add the amount on that form to your next tax return.

Why would you give the bank 100% of your interest rather than paying 30% or less of it in taxes? Besides, you'll owe the tax whether you give the interest to the bank or not.

Tom Adams

Do you get more money cashing in with Treasury Direct than you would get cashing in at a local bank?

Eva - Savings Bonds are worth the same redemption amount no matter where you cash them. Banks are paid by the government for handling Savings Bonds transactions - if they charge you, too, they are double-dipping and should be reported.

To cash a paper Savings Bond at Treasury Direct you'd have to open a Treasury Direct account and have your paper bond converted to an electronic bond.

Tom Adams

Had a question as to when I could cash an I Series Bond. Type in the question via Yahoo Search, your answer was there at the top of the list, very cool, Happy New Year!

My son has several savings bond about 20 yrs old I was recently told if he paid off school loans with then he would not be taxed by irs is this true. thank you in advance.

Chris - not true. Details of the Savings Bond college education deduction are here.

Tom Adams

It was my understanding that cashing a bond for school use would not be taxable. Is there a website or can you provide information on exactly "what" would be tax free for school. Tuition? School supplies? Traveling expense? Laptops?

Walter - the page you're looking for is here.

Tom Adams

Series EE Bond has registration in name of A, with POD in name of B. A dies. B dies five days later. Does the bond belong to A's estate or B's estate? In other words, is there any minimum period of survivorship before the bond permanently vests in the POD payee or his estate?

Jim - the rules just say the bond belongs to the estate of the person who died last - B in your example.

Tom Adams

I am 18 years old and have 12, $50 face value, Series EE Savings Bonds (paid $25 for them) and am listed as the co-owner on all of them. They are near maturity and I was wondering, were I to cash them in, who would be taxed, me or the other co-owner? I can't afford to pay taxes on them and I don't want my parents or grandparents to one day receive a statement saying that they have to pay taxes on some bonds that I cashed without them knowing

Christian - the 1099-INT that reports the interest to the IRS is typically issued under the Social Security Number of the person who cashes the bond. If that's you, whether you'd actually owe any tax or not depends on how much other income you have that year.

Tom Adams

My minor daughter has two savings bonds that I would like to cash in. Both of them have her name ("to") and then my husband's name as "or." One has her social security number and the other has his. Will I be able to cash them in since I am a legal guardian (with id)?

Maria - if you are the custodial parent you are allowed to sign the bond for your minor daughter. This will go best if you take her to the bank with you. Depending on her age and ID, they may allow her to sign the bond herself. Without her present you may get some resistance to cashing the bonds.

Tom Adams

Thank you Tom. Makes sense. As far as her age, she is three.

Maria - Then she's a little young to sign for herself (smile).

Tom Adams

My mother purchased HH savings bonds for my son they are in her name OR his - about 10 years ago, I looked to cash these bonds in, he was a minor, so I took them to our bank, had my signature guaranteed and was going to mail it to the Federal Reserve to cash it in - my mother then informed me not to since she was receiving the interest and did not want the bonds cashed in until 2009 - I now have the HH bond with my signature guaranteed on the back as mother of my then minor son (who is now of age) and we want to redeem the bond - he has filled out the direct deposit form in his name - will he have a problem when he send the bond in and if so, what would you recommend we do to avoid a problem - as we want to redeem it now

Laura - This is a very unusual situation and I don't have an answer for you. I think you should use my Ask the Treasury link to inquire what the right procedure is.

Tom Adams

Thank you Tom for your quick response - I have emailed my question to "Ask the Treasury" per your web link and if you like will let you know their response.

Laura - yes, that would be great if you could let us know how this works.

Tom Adams

I contacted the Redemption and Reissue department for H/HH Bond Servicing of the Dept of Treasury at 1-800-553-2663 (menu option 4 then option 2) - spoke with a very helpful woman who advised my son would have to strike out the completed portion of the back of the bond and then complete a P DF 1522 form (which requires that his signature be guaranteed by the bank as well) this form also provides the direct deposit information, so only one form needs to be completed. Once that is done he has to remit the completed form and bond directly to the Federal Reserve in order to redeem it. It seems like a simple procedure which I hope works as well as it sounds - Thanks for a great website Tom -

Tom I have a Series EE bond made out to my alias name not my legal name how do i go about cashing it?

Chip - In general, to get a bank to certify your signature on the back of a Savings Bond, you need to prove to the bank that you're the person named on the bond.

It's impossible for me to give you any specific advice because different banks have different ID policies.

However, if you know someone who works at a bank, who knows you by your alias name, and who will vouch for you, that would be a good start.

Otherwise you're going to have to sit down directly with your local bank and ask them what they will need from you to prove you're the person named on the bond, then you're going to have to meet their requirements.

Tom Adams

Hello,

My Nephew has some H Bonds that issued to his grandfather in 1994 or 95–they were made POD to my brother who died in 1996. My father (the grandfather) died in January 2007. I gave my nephew the H Bonds and a death certificate for his grandfather. Told him that he would need a death certificate of his father to redeem. Is there a time limit on when you can redeem these bonds? He took them to a bank and they told him that he didn't have any claim on these. These were separate items from the living trust that my father had set up. The only reference to anything for my nephew is that if his father died, he would inherit his share of the trust–i.e. the H Bonds in my brothers' name.

Any advice on how to get the money out of these for my nephew? I would appreciate any information that would be available.

Hi Tom,
I have a few series EE bonds for my daughter with my moms' (grandmas) name on it. We need to cash them out because of severe financial difficulty we're facing right now. How do we go about cashing my 7 year old daughters bonds, without grandma being here? The local bank told us to send them to grandma to cash out for us. Can i do it as a parent?

Peggy - When your brother died in 1996, the bonds became sole owner bonds in your father's name. When your father died the bonds became the property of your father's estate. Was your father's estate probated? You seem to reference his will. The probate court would determine who owns the bonds and issue the paperwork necessary to redeem them.

Bill - if your daughter's name is on the bonds, a custodial parent can sign for her. If only your mother's name is on the bonds, then legally the bonds belong only to your mother and only your mother can cash them.

Tom Adams

hi tom

my mother has many bonds in her name alone, her name and my deceased father's name, and her name and her deceased mother's name. She wants to sign these over to my sisters and I without cashing in. Is that possible and what steps would we need to take? Thank you

Jennifer - Is the reason she wants to sign these over so that she doesn't have to pay income tax on the interest they've earned? The IRS is all over that and she can't get out of the taxes.

You or one of your sisters should spend a weekend reading my book so you can advise your mother on how to manage this investment and pass it on in the lowest-cost way.

Tom Adams

Tom, My parents are both living and both their names are on EE bonds. They want to remove one of their names and put their Granddaugters name on it. she is not a minor. If the Grandaughter cashes it in who pays the taxes, assuming the name can be added to the bond.

Marcia - Make sure you they don't change the principal owner, who is assumed to be the one named first if no information is provided otherwise. That change would make the interest earned so far taxable as of the date of the name change.

However, the IRS says your parents would be responsible for the taxes, even if their granddaughter cashed the bond and received the 1099-INT tax form under her Social Security Number. Details are here.

Tom Adams

Tom, I have a friend in financial trouble she has a son with some savings bonds but they are set for him at age 18 currently he is 16. His name I believe is the only name on the bonds. Is there any way she can cash some of these in to help them with bills and such. Sorry I don't have more information about the bonds other than that.

Robert - I don't know what you mean by "they are set for him at age 18." Other than the one-year and five-year provisions explained in the article above, there's nothing to prevent the owner - the son in this case - from cashing the bonds now.

Tom Adams

According to her, he is unable to cash them till he is 18 yrs old. Something about He is unable to cash them till then, They are approximately 4 yrs old now.

Robert - most banks would let a 16-year old redeem a Savings Bond, particularly if the parent was also present. But if the bank insists the Savings Bond owner has to be 18 to cash the bond, then a custodial parent can sign for the minor.

Tom Adams

Ok Tom , I learned that the bonds are conservator bonds the money that purchased them was awarded to her son as proceeds to a hate crime case he won. Only his name is on them and he has to be 18 before even he can cash them in. This is all i can find out she wont tell me more.

Robert - It sounds like the bonds aren't actually registered to the son but to a trust of some sort.

That being the case, this isn't really a Savings Bond issue; what determines what can happen are the legal details of the conservator trust.

It sounds to me like there's no way she can cash the bonds. In any case, it sounds like it's her son's money.

Tom Adams

Tom- My dad bought series E bonds in 1979 and 1980 before going into the Marines and he has recently given them to me, before moving to Arizona. These bonds have his name (example: Brian Smith III)and POD Brian Smith Jr. (my grandfather [also living in Arizona]).

I live in Ohio and I would like to cash these bonds in as they were given to me and are just about 100% mature BUT my name is Brian Smith IV… SO, my question is- When I go to cash these, will I have any problem? Neither my ID nor my dad's have our suffix, just "Brian Smith".

Brian - You're not supposed to be able to cash them. What's important is the name on the bond, not who has possession of it.

Whether you would be challenged depends on the mood of the bank teller the day you go cash them.

Tom Adams

We have an 18 yr old living with us. He is estranged from his family. He received a letter from his mother over the weekend that stated she had cashed in "savings bonds taken out for him" and used the money for a vacation. We are wondering if there is any way to find out whether the savings bonds she cashed were indeed in the name of the 18 yr old before consulting a lawyer to reclaim the money.

Karen - My understanding is that you would need the serial numbers on the bonds to find out if they had been cashed. You can contact the Treasury to see if there's a way I don't know about.

Tom Adams

Thanks for the quick reply, Tom! I have emailed my question to the Treasury as you suggested. I'll post their response if they are able to help. I hope that no one else ever has this happen to them, but want to share what we find out just in case it can help someone else.

Karen

Tom,

Here's the response from the Treasury that you suggested I contact. I'm not particularly optimistic that the teen will be able to reclaim his funds, but it's nice to know that they responded quickly and will look into the matter further.

Thanks again!

Karen

"If the mother was named on the bonds, she is entitled to redeem the bonds.

You can send a letter to this office to explain the matter and request a search of our records to determine the status of the bonds. It is important to provide in the letter the approximate years in which the bonds could have been purchased and any possible social security account number, name and address which could have appeared first on the bond. A list of the bonds since you stated you have one.

The written request should be sent to this office:

Bureau of Public Debt
P. O. Box 7012
Parkersburg, WV 26106-7012"

Karen - They forgot to say that letter should be from 18-year-old, not from you, as they're not going to tell person A about person B's Savings Bonds. Good luck.

Tom Adams

hi tom i have two series EE bonds here. one is to my older son. his name is mis-speled his stepfather is or. the other bond i to my husband which we are separated but my youngest is the or. how do i go about getting them cash for them?

Angela - Since in each case the names are separated by OR, your sons can cash the bonds. If they are minors and you are the custodial parent, then you can sign for them.

Go back to the top of this page and read the article there. It has all the other information you need. (Slight name misspellings are common and shouldn't cause a problem.)

Tom Adams

My husbands mother recently gave him 4 $5,000.00 Series EE bonds that she purchased for him in his name with me as POD. They are almost to face value. They were purchased in 1994. The online calculator shows they are earning interest at a rate of 1.70% for 2 of them and 1.32% for the other 2. Would it be a good idea to cash them out and put them in a CD for 5 years at 3%?

Mary - It's fairly complicated to answer your question. Before I do the math, could you tell me exactly what month in 1994 they were issued?

Tom Adams

Yes 2 of them were purchased in January and the other 2 were purchased in May both in 1994.

Mary - If you hold the 1/94 bonds until they reach face value in Jan 2012, you will earn 2.09% annually. After that, under the current rules, they would earn 4%. However, the Treasury could change those rules between now and then so that they'd earn a lower rate. If you decide to cash these, this month would be a good time to do that.

The May 1994 bonds will reach face value in May 2012. The gain from their value now is equivalent to 2.64% annually. If you decide to cash these now, you'll lose a little more than $14 in interest per month for May and June. You can avoid this by waiting until November.

Keep in mind that when you cash these you will owe taxes on the interest, so you don't want to reinvest the full amount. Hold back what you need for taxes and reinvest what's left.

Tom Adams

my mother in law has $130,000 in matured E and EE savings bonds. Half are the name of her and my wife and the other have are in the name of her and my brother in law. she just tured 70 years old and has been retired for 3 years. how should she cash them in? reinvest? also my son is attending college, can she gift the bonds to him for college tuition?

Jake - There are no EE bonds yet that are "mature" in the sense that they've stopped earning interest. There's no need to worry about those now.

The ones you have to worry about are the E bonds that were issued more than 30 years ago. Those have stopped earning interest and need to be cashed. There will be (federal, but not state) income tax on the interest. Hold back some of the money to pay the tax and reinvest the rest.

The bonds should be cashed by the person with the lowest tax rate, who is probably your mother-in-law.

Because of the way the bonds are registered, you can't get the college education deduction. There's more info on that here.

Tom Adams

Tom-

I read Craig's 7/15/07 comment and readers should know that bond cashing requirements are not set by the banks. They merely try to help people with the transaction. Banks receive no fees for making or cashing bonds and I don't really know why they do it. As you can see, it is certainly appreciated by the public.

Ed

Ed - Actually banks do receive a fee for handling the transactions, but it's very small. Some banks and bankers handle Savings Bonds as a customer service. Others do it so that they have a shot at talking you into one of the bank's own products instead.

Tom Adams

My daughter was given some savings bonds by my ex-husbands family.

Some were issued with my ex husbands social security number but in her name before she had a social security number (when she was an infant) and also because they giver didn't know her social security number at the time.

Others are in her name and her social security number.

She is 30 days away from turning 18 and some of her bonds are past maturity.

She would like to cash them in and use them towards the purchase of a car.

Can she do this on the bonds that have her Father's social security number on them without having to have him present?

Kimberly - yes, she can cash them. The SSN on the bond is only used for tracking the bonds if they are lost.

The SSN on the bond doesn't come into play at all when you cash it. The bank will ask your daughter for her SSN and will use it to issue the 1099-INT tax form reporting the interest earned to the IRS.

Tom Adams

We have many savings bonds that we have been saving for both daughters over the years. My oldest is now 20 and needs to cash some in for college expenses. Many bonds are in my name with my daughter as POD. That's how I was told to set them up originally. What's the best way to completely transfer them to her so that she can cash them as appropriate, based on maturity? We are not eligible for the education tax exemption.
Thank you…

Linda - given the way the bonds are registered, you need to cash them, hold back what you need for income tax, and give your daughter what's left.

Tom Adams

Tom,
I have a $500 savings bond that is made out to my minor daughter and my husband. I am still married am I able to cash in the bond?

Thank You

Hi I was wondering what I should do with a savings bond I found of my sons. He passed away in 93. who do I go to to get the name transferred or is it just garbage now?

Hi Tom … I purchased EE bonds back in the early 1990's with a family member listed as a co-owner. I would like to make sure that this family member does not have the bonds re-issued to him (even with my name still on the re-issued bonds) and then cash them in prior to my passing. What options do I have to make sure that this doesn't happen? I have verbally been told by the folks at Treasury Direct that if I open an account and go paperless with those bonds that he will not have access to the bonds. Is that correct?Thanks for you help.

Jennifer - If your daughter's name is listed first (or second with an OR between the names), you can technically sign for her because you're a custodial parent. However, some banks will only deal with the parent named on the bond. I can't predict what your bank will do.

Gina - You can have the bond reissued to you using this form. Follow the instructions on the form.

Larry - Switching the bonds to electronic bonds is my advice as well.

Tom Adams

A donor wants to transfer his EE US Savings bonds to our 510c3 agency. How does he do this? Are there any income tax implications?

William - your donor has to cash the bond himself, add the Savings Bond interest to his taxable income, give you the money, then take a charitable deduction on his tax return for the amount of the gift.

The Treasury doesn't allow Savings Bond transfers to charitable organizations.

Tom Adams

I have an EE bond which was purchased in April 1980. Will it stop earning interest in April 2010, or 6 months after? In other words, should I cash it on April 1st or October 1st?

Do all banks have to cash savings bonds?

Donald - An April 1980 EE bond will earn its last interest payment during March, 2010. You should cash it in April 2010.

Angie - No, banks aren't required to cash Savings Bonds.

Tom Adams