mlktwins Posted March 29 Share Posted March 29 If you or your parents have matured savings bonds that haven't been cashed in, please know you/they should have been including the interest on federal taxes in the year they matured - not the year they are actually cashed in. I wish I had know this in 2020, 2021, and 2022 for my dad's taxes. Was totally not on my radar. And he had quite a few that matured in 2022 that haven't been cashed in so that is 😬😔. I am doing that now with my POA and it is a pain because they have to be sent in and all kinds of fun stuff. Anyway, learn from my mistakes if y'all have any old savings bonds sitting somewhere. I made a ton of extra work (and big headaches) for myself. Please don't quote as I will probably delete this in a few days. 10 Quote Link to comment Share on other sites More sharing options...
Amethyst Posted March 29 Share Posted March 29 Are you sure? This seems to indicate otherwise. In general, you must report the interest in income in the taxable year in which you redeemed the bonds to the extent you did not include the interest in income in a prior taxable year. 1 Quote Link to comment Share on other sites More sharing options...
YaelAldrich Posted March 29 Share Posted March 29 Maybe I'm slow but what does the timing have to do with the headaches you are having cashing them out? Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 2 hours ago, Amethyst said: Are you sure? This seems to indicate otherwise. In general, you must report the interest in income in the taxable year in which you redeemed the bonds to the extent you did not include the interest in income in a prior taxable year. That is talking about if you redeemed the bonds. He has not redeemed matured bonds since 2020. You are to report the interest on matured bonds in the year they mature, even if you don’t redeem them during that year. 1 Quote Link to comment Share on other sites More sharing options...
Amethyst Posted March 29 Share Posted March 29 1 hour ago, mlktwins said: That is talking about if you redeemed the bonds. He has not redeemed matured bonds since 2020. You are to report the interest on matured bonds in the year they mature, even if you don’t redeem them during that year. Yes, but if you redeem them in 2024, even if they matured in 2021, why not just report in 2024 tax year? Quote Link to comment Share on other sites More sharing options...
Arcadia Posted March 29 Share Posted March 29 3 hours ago, YaelAldrich said: Maybe I'm slow but what does the timing have to do with the headaches you are having cashing them out? I think OP’s problem is with IRS taxes and not with the cashing in. The IRS link Amethyst posted seems to say OP would not need to file amended tax returns for those bonds. Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 2 minutes ago, Arcadia said: I think OP’s problem is with IRS taxes and not with the cashing in. The IRS link Amethyst posted seems to say OP would not need to file amended tax returns for those bonds. Yea, the concern is with the actual taxes. I am wondering if the IRS link posted is assuming the bond was redeemed before they matured. Many articles say to include as interest income in the year matured and to amend returns if that didn’t happen. But then what happens if I do that and then the 1099 shows that they were all redeemed in 2024. This is such a headache. I just want to do it correctly and be done with it at this point. It is a lot of bonds! Quote Link to comment Share on other sites More sharing options...
Arcadia Posted March 29 Share Posted March 29 3 minutes ago, mlktwins said: This is such a headache. I just want to do it correctly and be done with it at this point. It is a lot of bonds! Do you have an IRS office near you? We went twice to the one near us when IRS lost part of our tax form twice many years ago. We did a walk in but making an appointment might be better. https://apps.irs.gov/app/office-locator/ 1 Quote Link to comment Share on other sites More sharing options...
Ting Tang Posted March 29 Share Posted March 29 I'm confused. I have bonds that have matured but are not cashed in. So I have to do something with these? They've been locked away and out of sight... Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 Just now, Ting Tang said: I'm confused. I have bonds that have matured but are not cashed in. So I have to do something with these? They've been locked away and out of sight... I will let you know when I know for sure! 1 1 Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 https://www.irs.gov/pub/irs-pdf/p550.pdf (Page 10) Reporting options for cash method taxpayers. If you use the cash method of reporting income, you can report the interest on Series EE, Series E, and Series I bonds in either of the following ways. 1. Method 1. Postpone reporting the interest until the earlier of the year you cash or dispose of the bonds or the year in which they mature. (However, see Savings bonds traded, later.) Note. Series EE bonds issued in 1993 matured in 2023. If you have used method 1, you generally must report the interest on these bonds on your 2023 return. 2. Method 2. Choose to report the increase in redemption value as interest each year. You must use the same method for all Series EE and Series I bonds you own. If you do not choose method 2 by reporting the increase in redemption value as interest each year, you must use method 1. This says the earlier of the year you cash the bonds or the year in which they mature. I am just going to do the amendments and be done with it. It was only 2020-2023 that are an issue for us and I can do 2023's correctly. I shouldn't have to amend state taxes since interest from savings bonds is exempt at the state level, but I will double check that too. 2 Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 31 minutes ago, Arcadia said: Do you have an IRS office near you? We went twice to the one near us when IRS lost part of our tax form twice many years ago. We did a walk in but making an appointment might be better. https://apps.irs.gov/app/office-locator/ We do have one close by. Quote Link to comment Share on other sites More sharing options...
TexasProud Posted March 29 Share Posted March 29 Interesting, because it also you should get a 1099 INT for it if it is cashed out or matures. Huh... I didn't know this and ours are about to or already have matured... If we stared buying 30 year bonds when we got married and for the first 5 years or so of our marriage, that means some of them started maturing in 2020... But we have never gotten a 1099 for any of them. I also inherited a ton from my dad when he died and yes, we transferred the name on them. So, let me know what you find out. May shoot an email to our accountant. Quote Link to comment Share on other sites More sharing options...
TexasProud Posted March 29 Share Posted March 29 Ok I found this: https://www.treasurydirect.gov/savings-bonds/tax-information-ee-i-bonds/ It is still somewhat confusing because if you have paper, then it looks like whoever has them, should send the 1099 to you.... But it also kind of looks like if you waited until you get paid. Well, technically, I don't get paid for them until I cash them and we haven't cashed them. Very confusing and we are pretty savvy, and I had no clue. Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 21 minutes ago, TexasProud said: Ok I found this: https://www.treasurydirect.gov/savings-bonds/tax-information-ee-i-bonds/ It is still somewhat confusing because if you have paper, then it looks like whoever has them, should send the 1099 to you.... But it also kind of looks like if you waited until you get paid. Well, technically, I don't get paid for them until I cash them and we haven't cashed them. Very confusing and we are pretty savvy, and I had no clue. You won’t get a 1099 until you redeem them. Quote Link to comment Share on other sites More sharing options...
TexasProud Posted March 29 Share Posted March 29 (edited) 7 minutes ago, mlktwins said: You won’t get a 1099 until you redeem them. Ok then you shouldn't have to report it until you redeem them then. Otherwise, how would they be able to track it... So confusing. If what you say is true, I bet most people do it incorrectly and most never go back and refile. They just put it on the current one they file because that is when they got the money. But my husband is going to ask our accountant, and if we do...ughh. it would be a royal pain. We have a lot. We had money automatically taken out of our account every month for them and so did my dad. Edited March 29 by TexasProud 2 Quote Link to comment Share on other sites More sharing options...
mlktwins Posted March 29 Author Share Posted March 29 2 minutes ago, TexasProud said: Ok then you shouldn't have to report it until you redeem them then. Not really the case. I posted IRS Pub 550 above. Quote Link to comment Share on other sites More sharing options...
TexasProud Posted March 29 Share Posted March 29 (edited) I don't see any way the IRS or the taxpayer could keep up with it. 9 minutes ago, mlktwins said: Not really the case. I posted IRS Pub 550 above. See my addition I added... Like really, there is no way to keep track of all of this. If they accountant says what you say is true, then we will probably just start redeeming them each year they are due and paying the taxes. We will not go back to the ones from 2020-2022. Our estate can handle it after we die. It shouldn't trigger anything if you don't cash them. But really, if this is true, that is an absolutely confusing way to do and most people are like us. We were just going to keep them in the safe until we died unless it was a true emergency. Edited March 29 by TexasProud Quote Link to comment Share on other sites More sharing options...
Bootsie Posted March 30 Share Posted March 30 Why would you have bonds that have matured that you do not redeem? I can understand someone who is elderly and does not realize that the bonds have matured? But it sounds as if a number of you are saying that you have bonds that you know have matured, but rather than redeeming the bonds (and making some other investment with the money) you just keep the bonds in a safe deposit box? Quote Link to comment Share on other sites More sharing options...
El... Posted March 30 Share Posted March 30 24 minutes ago, Bootsie said: Why would you have bonds that have matured that you do not redeem? I can understand someone who is elderly and does not realize that the bonds have matured? But it sounds as if a number of you are saying that you have bonds that you know have matured, but rather than redeeming the bonds (and making some other investment with the money) you just keep the bonds in a safe deposit box? Mmm. If your grandma bought them for you and you forgot about them. Until now. 3 Quote Link to comment Share on other sites More sharing options...
TexasProud Posted March 30 Share Posted March 30 1 hour ago, Bootsie said: Why would you have bonds that have matured that you do not redeem? I can understand someone who is elderly and does not realize that the bonds have matured? But it sounds as if a number of you are saying that you have bonds that you know have matured, but rather than redeeming the bonds (and making some other investment with the money) you just keep the bonds in a safe deposit box? Because they are in one of our two safes...the one we never open or go into. The last time I thought about them was when my dad died and I had to divide his with my sister and we had to sign them and mail them back to get them issued in our name. Then we checked into what they were worth and when they would mature as well as the ones we bought from1990- I'm honestly not sure, at least 1995 and maybe until 1997 or so. At some point we stopped. And I never thought about them again. To my mind, they are just emergency money. But yes, now that we have thought about it, we will dive into the safe at some point and uncover the little safe and get them out. I only thought about them because of this thread. Quote Link to comment Share on other sites More sharing options...
athena1277 Posted March 30 Share Posted March 30 2 hours ago, El... said: Mmm. If your grandma bought them for you and you forgot about them. Until now. I’m in this category. Plus we bought several the first few years we were married. We talked about using them years ago, but got confused about which were matured and how to get the money from them. So we did nothing. 2 Quote Link to comment Share on other sites More sharing options...
DawnM Posted March 30 Share Posted March 30 We have a few that were given to us when our boys were born. They are in the safe and I rarely think about them. They are very small. 2 Quote Link to comment Share on other sites More sharing options...
Amethyst Posted March 30 Share Posted March 30 7 hours ago, athena1277 said: I’m in this category. Plus we bought several the first few years we were married. We talked about using them years ago, but got confused about which were matured and how to get the money from them. So we did nothing. You take them to the bank and tell the cashier that you want to redeem them. Very simple process. Plus, if you use them for education, I believe there is some kind of tax break. 1 Quote Link to comment Share on other sites More sharing options...
Pawz4me Posted March 30 Share Posted March 30 51 minutes ago, Amethyst said: You take them to the bank and tell the cashier that you want to redeem them. Very simple process. Plus, if you use them for education, I believe there is some kind of tax break. I'm old enough to remember when cashing in savings bonds was as simple as walking into your bank, but my understanding is that it's not always that simple nowadays. From this Nerdwallet article: Quote You can cash paper bonds at a bank or through the U.S. Department of the Treasury’s TreasuryDirect website. Not all banks offer the service, and many only provide it if you are an account holder, according to a NerdWallet analysis of the 20 largest U.S. banks. Some, such as PNC Bank and TD Bank, stipulate that you need to be an account holder for a year before cashing a savings bond. Of the two banks and two credit unions where I have accounts, only one cashes savings bonds, so call ahead. Another reason to contact your financial institution before heading to a branch is that some banks may not cash all types of bonds. Regions Bank, for example, doesn’t let you cash bonds in the name of a guardian, trustee or other representative of an estate; you also can’t cash bonds if you’re acting as a power of attorney. You likely can’t cash damaged or altered bonds anywhere. If you have a paper savings bond but your bank can’t cash it, you’ll need to redeem it online at TreasuryDirect or at a financial institution that will cash savings bonds for non-account holders. Wells Fargo and Truist are two banks that will do this, provided that the bonds total less than $1,000 and you bring proper documentation. I cashed several bonds at Wells Fargo recently, where I am not an account holder, and I needed two forms of ID. 1 Quote Link to comment Share on other sites More sharing options...
Amethyst Posted March 30 Share Posted March 30 36 minutes ago, Pawz4me said: I'm old enough to remember when cashing in savings bonds was as simple as walking into your bank, but my understanding is that it's not always that simple nowadays. From this Nerdwallet article: I just did it a few months ago at my local bank. But I understand that people don’t always have a local bank any more. 1 Quote Link to comment Share on other sites More sharing options...
EKS Posted March 30 Share Posted March 30 12 hours ago, Bootsie said: Why would you have bonds that have matured that you do not redeem? I have some from the 1970s that are so old that the calculator at the savings bond website won't calculate their value. Why? Because I never redeemed them. Quote Link to comment Share on other sites More sharing options...
TexasProud Posted March 30 Share Posted March 30 4 hours ago, Amethyst said: You take them to the bank and tell the cashier that you want to redeem them. Yeah, no it isn't. I don't think any of our banks in town do it... Quote Link to comment Share on other sites More sharing options...
Amethyst Posted March 30 Share Posted March 30 7 minutes ago, TexasProud said: Yeah, no it isn't. I don't think any of our banks in town do it... This is interesting to me. I’ve had many many bonds over the years. I just redeemed our very last one a few months ago. I’ve always just gone to the bank. No problem. So, I’m over here shaking my head about all the people who don’t redeem them when they mature. But now I understand a little better…if my bank didn’t do it, I wouldn’t know how to redeem them either! 2 1 Quote Link to comment Share on other sites More sharing options...
mlktwins Posted April 1 Author Share Posted April 1 On 3/30/2024 at 11:54 AM, Amethyst said: This is interesting to me. I’ve had many many bonds over the years. I just redeemed our very last one a few months ago. I’ve always just gone to the bank. No problem. So, I’m over here shaking my head about all the people who don’t redeem them when they mature. But now I understand a little better…if my bank didn’t do it, I wouldn’t know how to redeem them either! There is now only one bank/credit union in my area that will redeem savings bonds. If I could get my dad to one of his credit unions, they would do it, but they will not let me do it as POA and secondary trustee. I have to mail them all in - PITA. You mail them into Treasury Direct. Quote Link to comment Share on other sites More sharing options...
Amethyst Posted April 1 Share Posted April 1 (edited) 5 minutes ago, mlktwins said: There is now only one bank/credit union in my area that will redeem savings bonds. If I could get my dad to one of his credit unions, they would do it, but they will not let me do it as POA and secondary trustee. I have to mail them all in - PITA. You mail them into Treasury Direct. Yes, I wouldn’t think it would be an easy process for you with POA. I was thinking more of the people here who are just sitting on matured bonds. Edited April 1 by Amethyst Quote Link to comment Share on other sites More sharing options...
Tina Posted April 2 Share Posted April 2 On 3/30/2024 at 5:49 AM, Amethyst said: You take them to the bank and tell the cashier that you want to redeem them. Very simple process. Plus, if you use them for education, I believe there is some kind of tax break. A handful of banks I checked with wouldn't cash paper bonds. They have to be mailed in. Quote Link to comment Share on other sites More sharing options...
Amethyst Posted April 2 Share Posted April 2 11 hours ago, Tina said: A handful of banks I checked with wouldn't cash paper bonds. They have to be mailed in. Interesting. Do you have an account at any of those banks? I would think a bank would only provide the service for an account holder. Quote Link to comment Share on other sites More sharing options...
amyx4 Posted April 2 Share Posted April 2 My college aged guys just cashed their bonds in this January. The filled out the form linked below and mailed in the bonds. One requested a check and the other requested direct deposit. They will be using the money for tuiton/student loans. The form says you need a certified signature for more than $1000. My guys just sent in two forms/two envelopes mailed about a month apart with each envelope totally under $1000 and everything went smoothly. https://www.treasurydirect.gov/forms/sav1522.pdf 1 Quote Link to comment Share on other sites More sharing options...
Bootsie Posted April 2 Share Posted April 2 Series HH bonds cannot be redeemed at a bank. A handful of banks will redeem other series paper savings bonds. This article 12 Banks That Cash Savings Bonds (+ How Else to Redeem Them) - First Quarter Finance has a list--but I do not know if it is accurate. Quote Link to comment Share on other sites More sharing options...
mlktwins Posted April 2 Author Share Posted April 2 5 hours ago, Amethyst said: Interesting. Do you have an account at any of those banks? I would think a bank would only provide the service for an account holder. My dad has accounts at 5-6 banks/credit union accounts (long time member). Even though several of them used to do it, only one of them now redeems bonds. It is not so common here anymore and we live in No. VA near DC. My husband had to send in some Series HH bonds for redemption. My dad could have redeemed his Series EE bonds at his credit union if he were able to get there and sign them. I have just a few of my own Series I bonds that I think I might just move into a Treasury Direct Account. Same with my boys. They don't mature until sometime in the 2030's. Quote Link to comment Share on other sites More sharing options...
Amethyst Posted April 2 Share Posted April 2 55 minutes ago, mlktwins said: My dad has accounts at 5-6 banks/credit union accounts (long time member). Even though several of them used to do it, only one of them now redeems bonds. It is not so common here anymore and we live in No. VA near DC. Wow, I had no idea it was getting so rare. I guess I should be glad I just redeemed the last of them. Quote Link to comment Share on other sites More sharing options...
Tina Posted April 3 Share Posted April 3 12 hours ago, Amethyst said: Interesting. Do you have an account at any of those banks? I would think a bank would only provide the service for an account holder. Yes, I checked three where I bank. Quote Link to comment Share on other sites More sharing options...
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