Comments on: Should we add our children's names to our Savings Bonds?

by: Tom Adams

Fri, 22 Aug 2008 13:24:17 +0000

Kay - whether your mother is #1 or #2 doesn't make any difference. Since she has passed away, the bonds are now sole-owner bonds and you're the sole owner.

You can't transfer responsibility for the taxes to your niece. If you want to gift the money to her, cash the bonds, hold back what you'll need for taxes, and give her what's left.

If you transfer the bonds to her rather than cash, you'll still have to pay the tax up to the date of the transfer yourself, so you don't gain anything by doing that.

Tom Adams

by: Kay Harvey

Fri, 22 Aug 2008 01:47:42 +0000

My mother was coowner #1 on some of my series EE bonds and coowner #2 on others.

She passed away in 2004.

If I want to gift the bonds to her granddaughter (my niece) and have her use the money for her current enrollment in Medical School, how do I do this? If she cashes the bonds, does she claim the interest? Can I do this with both types of bonds, or just the ones that have her deceased grandmother as coowner #1?

by: Tom Adams

Wed, 09 Jul 2008 15:44:52 +0000

Hi Fred - I don't recommend it, but the only way to gift the bonds with no tax consequences for you is to die.

If your daughter is a dependent on your tax return, you may be able to take advantage of the college education deduction to avoid the tax.

Tom Adams

by: Fred Capo

Tue, 08 Jul 2008 22:18:05 +0000

Tom - Is there a way to "gift" savings bonds that I have owned for years to my adult children with no tax consequence to myself? The idea us to have them redeem them at their tax rates? Daughter is presently a student with no income.