US Savings Bonds

Posts Tagged ‘savings bonds tax free for education’

Question: Can I elect to pay tax on Series EE US Savings Bonds?

I have heard something about making an election to report accrued interest on EE Savings Bonds before they are redeemed. I just graduated and I expect the 2010 tax year to be the lowest tax bracket I’ll be in for the rest of my life. Therefore, if it’s possible to pay tax on the accrued interest without redeeming my Savings Bonds, I sure would like to do it. Is it possible to make this election and if so, how? Do I just attach a statement with my schedule B?
The bonds mature in 2018 and are paying 4%.
Why is it late? From the sound of what you posted, it seems like I can do it with no problem.. am I misreading?
They were a gift to me for my 2nd birthday. A few months ago, my dad found them in his safety deposit box and gave them to me. I did not even know I had bonds until then so I have not been “accounting” for them at all nor made any tax elections at all.

Answer: Yes you can. Go here, then look under the heading Interest Income…US Savings Bonds.

http://www.irs.gov/publications/p550/ch01.html#en_US_publink10009895

Also here…

http://www.treasurydirect.gov/indiv/research/indepth/ebonds/res_e_bonds_eetaxconsider.htm

Tax Refunds Could Make Me $500000?!

Question: Can I use Savings Bonds for Education that are POD in my name?

My father recently passed away and he had $40,000 worth of Savings Bonds that he had purchased back in 1992. I am listed as the POD (Payable on Death) on them. Can I use these for education for myself? I would like to go back to school and it would be great if I could use these tax-free.

Answer: yes but you will not use them tax-free — they are taxable for who ever cashes them!!!!

Fiscal Commission Public Forum 3 of 7

Question: Should I invest in Savings Bonds?

I was thinking about investing into some Savings Bonds. Is this a good idea? And if I do, which ones would be the most beneficial? What are the different kinds and their interest rates? Tax free? Thanks.

Answer: Savings Bonds are a safe investment but you wont get rich off of them. Series EE Bonds in my opinion are the best to buy.I’ve included a link that gives you more info on the different types interest rates etc.They are tax exempt IF you use them for educations purposes only.

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