Tax information for EE and I bonds — TreasuryDirect (2024)

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Tax information for EE and I bonds — TreasuryDirect (1)

Note: The tax situation is different for HH bonds, which may still be earning interest.

Is savings bond interest taxable?

The interest that your savings bonds earn is subject to

  • federal income tax, but not state or local income tax
  • any federal estate, gift, and excise taxes and any state estate or inheritance taxes

Using the money for higher education may keep you from paying federal income tax on your savings bond interest. See the possibilities and restrictions for using savings bonds for education.

When do I get the interest on my EE or I bonds?

Your EE and I savings bonds earn interest from the first month you own them. You get the interest all at once. For a paper bond, this happens when you cash the bond. For an electronic bond, it happens either when you cash the bond or when the bond finishes its 30-year life (it matures). When an electronic bond matures, we put the money into the Certificate of Indebtedness in your TreasuryDirect account.

When must I report the interest?

You have a choice. You can

  • put off (defer) reporting the interest until you file a federal income tax return for the year in which you actually get the interest, or
  • report the interest each year even though you don't actually get the interest then

Deferring until you get the interest

Most people put off reporting the interest until they actually get it.

You get a Form 1099-INT for the year in which you get the interest. (INT stands for "interest." The 1099-INT tells you how much interest the bond earned.)

  • If a financial institution pays the bond, you get a 1099-INT from that financial institution either soon after you cash your bond or by January 31 of the following year.
  • If your bonds are in your TreasuryDirect account, your 1099-INT is available in your account by January 31 of the following year.
    • Go to your TreasuryDirect account.
    • Select the ManageDirect tab.
    • Under "Manage My Taxes", choose the relevant year.
    • Near the top of your "Taxable Transaction Summary", choose the link to view your 1099.
    • Video

NOTE: Your "Taxable Transaction Summary" is NOT your 1099.

Reporting the interest every year

You may choose to report the interest every year. For example, you may find it advantageous to report interest every year on savings bonds in a child's name. The child may be paying taxes at a lower rate than will be true years later when the bond matures.

But you will not get a 1099-INT every year. You only get a 1099-INT at the end.

  • If the savings bonds are in a TreasuryDirect account, you can see the interest earned each year in the account.
  • If the savings bonds are on paper, our Savings Bond Calculator can help you figure out the interest to report.

When you get the 1099-INT at the end, it will show all the interest the bond earned over the years. For instructions on how to tell the IRS that you already reported some or all of that interest in earlier years, go to IRS Publication 550 and look for the section on U.S. Savings Bonds.

Changing from one method to the other

You can change from one reporting method to the other.

  • You were deferring. You now want to report every year.

    You may do this without permission from the IRS.

    But you must do this for all the savings bonds for the Social Security Number whose tax return this is. In addition to the interest for the year you are now reporting, you must also report all interest those bonds earned in the years before you changed.

  • You were reporting each year. You now want to defer the interest.

    You must fill out IRS Form 3115 or follow the instructions in IRS Publication 550 in the section on U.S. Savings Bonds

Where do I list the interest on my tax return?

Interest from your bonds goes on your federal income tax return on the same line with other interest income.

If you are reporting the interest on bonds another person owns (for example, the interest on your child's bonds), you report that on the other person's federal income tax return with other interest income that person has earned.

Who owes the tax?

If ownership has not changed

Situation Who owes the tax
You are the only owner of the bond You owe the tax
You use your money to buy a bond that you put in your name with a co-owner You owe the tax
You buy the bond but someone else is named as the only owner (for example, your child) The person who is named as the owner (not you)
You and another person buy a bond together, each putting in part of the money to buy the bond, and you are both named as co-owners You and the other person must each report the interest in proportion to how much you each paid for the bond
You and your spouse live in a community property state and buy a bond that is community property and you file separate federal income tax returns You and your spouse each report one-half of the interest

If ownership changes

Situation Who owes the tax

You give up ownership of the bond.

We reissue the bond.

You owe tax on the interest the bond earned until it was reissued.
You are the new owner of a reissued bond. You owe tax on the interest the bond earns after it was reissued.
For electronic savings bonds in TreasuryDirect
  • When we reissue the bond, we report the total interest the bond earned so far on a 1099-INT in the name and Social Security Number of the person being removed (the previous owner).
  • When the new owner later cashes in the bond or the bond matures, we report the interest in the name and Social Security Number of the person being paid (the new owner). However, we report only the interest earned after we reissued the bond.

Therefore, whether you are the old owner or the new owner of an electronic savings bond, your 1099-INT will reflect the interest you earned on your EE or I savings bonds.

For paper savings bonds

The 1099-INT will only come when someone cashes the bond or the bond matures. The interest will be reported under the name and Social Security Number of the person who cashes the bond or who owns it when it matures. The 1099-INT will include all the interest the bond earned over its lifetime. If you are the new owner who gets that 1099-INT, you must prove to the IRS that a portion of the interest was previously reported to a different owner.

For instructions on how to pay tax only on the interest that you owe (the interest the bond has earned since you became the bond owner), see IRS Publication 550.

More about reissuing EE or I savings bonds

Tax information for EE and I bonds — TreasuryDirect (2024)

FAQs

Tax information for EE and I bonds — TreasuryDirect? ›

If a financial institution pays the bond, you get a 1099-INT from that financial institution either soon after you cash your bond or by January 31 of the following year. If your bonds are in your TreasuryDirect account, your 1099-INT is available in your account by January 31 of the following year.

Are Series EE or I savings bonds taxable? ›

The tax situation is the same for both EE and I bonds. For federal income tax, you choose whether to report earnings each year or wait to report all the earnings when the bond finishes earning interest (or when you cash it if you cash it before the end of its 30 year life).

Do I get a tax statement for I bonds? ›

A 1099-INT issued when you cash the I bond will show all interest earned from the date of issue, including interest earned before it was reissued. IRS Publication 550 has instructions for paying tax only on the interest earned after the bond was reissued.

How do I report EE bonds on taxes? ›

With electronic Series EE bonds, the redemption process is automatic and interest is reported to the IRS. Interest earnings on bonds are reported on IRS Form 1099-INT. It's important to keep in mind that savings bond interest is subject to more than one type of tax.

Does TreasuryDirect send 1099 for bonds? ›

If you are waiting until your EE or I bond matures (finishes its life) to take the interest on it, you will not get a 1099-INT for that bond until we actually pay you the interest. If you have a TreasuryDirect account, you must get your 1099-INT yourself from your account.

How do I avoid taxes on EE savings bonds? ›

You can exclude the interest from your series EE and series I U.S. savings bonds on Form 8815 of the 1040. Form 8815 helps calculate the amount of interest that you can exclude from your tax return. If all the interest was not used for a qualified higher education expense you will stay pay taxes on that amount.

How much is a $100 series EE bond worth after 30 years? ›

How to get the most value from your savings bonds
Face ValuePurchase Amount30-Year Value (Purchased May 1990)
$50 Bond$100$207.36
$100 Bond$200$414.72
$500 Bond$400$1,036.80
$1,000 Bond$800$2,073.60
5 days ago

Do you have to file taxes on I bonds? ›

For those who bought I bonds for the first time or just need a quick reminder, know this: All that interest income is taxable as regular income. If you cashed in, you need to report the interest on your tax return even if finding a 1099 for I bonds is more complicated than other investments.

Can I get a statement on TreasuryDirect? ›

The Account Statements will be available on the 1st business day of the month no later than 1pm Eastern Time.

How do I know if my bond is taxable? ›

The interest you earn on corporate bonds is generally always taxable. Most all interest income earned on municipal bonds is exempt from federal income taxes. When you buy muni bonds issued by the state where you file state taxes, the interest you earn is usually also exempt from state income taxes.

What is the tax exemption form for Series EE savings bonds? ›

If you cashed series EE or I U.S. savings bonds this year that were issued after 1989, you may be able to exclude from your income part or all of the interest on those bonds. Use Form 8815 to figure the amount of any interest you may exclude.

How are EE bonds taxed at death? ›

If the executor doesn't include predeath interest on the decedent's final return, then the beneficiary owes federal income tax on all pre- and post-death interest on the earlier of the bond's maturity or redemption.

When should I cash in my series EE bonds? ›

You can cash in (redeem) your EE bond after 12 months. However, if you cash in the bond in less than 5 years, you lose the last 3 months of interest. For example, if you cash in the bond after 18 months, you get the first 15 months of interest.

Do I need to report Treasury bonds on tax return? ›

Interest from your bonds goes on your federal income tax return on the same line with other interest income.

How much tax will I pay on my EE savings bonds? ›

The interest on EE bonds isn't taxed as it accrues unless the owner elects to have it taxed annually. If an election is made, all previously accrued but untaxed interest is also reported in the election year. In most cases, this election isn't made so bond holders receive the benefits of tax deferral.

Does TurboTax import from TreasuryDirect? ›

You usually get a single 1099-INT from Treasury Direct on which everything will be totalled which you will enter or import into TurboTax.

Do I pay taxes on i-bonds? ›

Interest on I bonds is exempt from state and local taxes but taxed at the federal level at ordinary income-tax rates.

Which bonds are tax-exempt? ›

Municipal Bonds

Most bonds issued by government agencies are tax-exempt. This means interest on these bonds are excluded from gross income for federal tax purposes.

Do I qualify to exclude series EE or I bond interest? ›

To qualify for the exclusion, the bonds must be series EE or I U.S. savings bonds issued after 1989 in your name, or, if you are married, they may be issued in your name and your spouse's name. Also, you must have been age 24 or older before the bonds were issued.

Are I bonds considered savings bonds? ›

I savings bonds earn interest monthly. Interest is compounded semiannually, meaning that every 6 months we apply the bond's interest rate to a new principal value.

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