Series I Bonds Advantages 

Series i bonds advantages are discussed in this section of US savings bonds information website. Series i US savings bonds have many advantages. Many of the advantages of Series i bonds are shared by other US savings bonds.

Series I Bonds Advantages

• TIPS are guaranteed by the full faith and credit of the U.S. government.

• TIPS are exempt from state and local income taxes.

• As long as the Series I bonds are held for a minimum of one year, the investor can redeem Series I bonds at any time up to 30-years from the date of purchase.

• No Federal Income taxes are assessed on the accrual and compounding of interest until the investor redeems the bonds.

Series I Bonds Considerations and Drawbacks

• CPI inflation may not match the inflation rate of the investor’s own market basket of purchases.

• The bonds must be held for a minimum of one year and are not freely tradeable.

• A 3-month foregone interest penalty is assessed if the security is redeemed within 5 years.

• The maximum allowable purchase amount is $30,000 per person per year. Advantages Considerations and Drawbacks

Note: (1) Plus the CPI-U rate of inflation