How to Find Out How Much Interest on Income From Series EE Savings Bonds for Taxes

Find out how much interest to report for taxes.

If you have EE savings bonds, you have to pay federal income taxes on the interest. You may choose to pay yearly or postpone it until redemption or final maturity, 30 years after purchase. Inheritance and estate taxes also apply to EE bonds, but not state income taxes. Most owners postpone federal income tax until maturity or redemption. Fortunately, the government facilitates computing the interest received in either case.

Instructions

1. Log on to the Treasury's Savings Bond Calculator when your EE bonds mature or when you want to sell them. Use the link in Resources.

2. Enter the information for your bonds in the Calculator. The series box should stay at "EE Bonds." Find the correct denomination in the drop-down box. Then enter the serial number and issue date of each bond.

3. Click the blue "Calculate" box to find complete information for each bond. This includes the issue price, the interest, the total value of your bonds and the total interest. The Treasury pays interest on EE bonds monthly. Unless you wait until a new month to cash still-earning bonds, the total interest is your taxable amount if you are reporting the interest at maturity or redemption. Print your inventory.

4. Compare the total interest from the Calculator to your IRS Form 1099-T. If you do not receive this form when you redeem your EE bonds, you will get it soon after the end of the year. The Internal Revenue Service will receive the same information, so you must claim this official total on your federal income tax return. It should match the total you computed online.

5. Find interest earned on each bond on form PD 3501, if you prefer to report interest yearly. Download the form using the link in Resources. Find the denominations and issue dates of your bonds on the form. You will find the interest earned in the right-hand column. Total the interest on all your bonds to find your annual reporting obligation.

Tips & Warnings

• Use the Savings Bond Wizard to find your interest earnings if you have electronic EE bonds. You can print your list of bonds, find their value and see what interest they have earned, similar to the Savings Bond Calculator.

• If you begin reporting interest on your savings bonds yearly the first year, you must continue.

• If you cash your EE savings bonds to pay for educational expenses, your interest may qualify for exemption from federal income tax. See the link to "Education Planning" in Resources for details.

• Other special events may require you to report the interest on your bonds. One example is if you apply for reissue of the bonds at the death of the owner.

References

• Treasury Direct: EE Savings Bonds Tax Considerations
• Treasury Direct: EE/E Savings Bonds
• Treasury DIrect: EE/E Bonds Rates & Terms

Resources

• Treasury Direct: Calculate the Value of Your Paper Savings Bonds
• Treasury Direct: Savings Bond Wizard
• Treasury Direct: Education Planning
• Treasury Direct: Form PD 3501 E