How to Cash in the Bonds of a Deceased Parent

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Savings bonds are a tried-and-true means of tucking money aside for a rainy day and earning some interest on it besides. They’ve been around in one form or another since 1935, courtesy of President Franklin D. Roosevelt’s legislative approval of “baby bonds.” Cashing bonds in after the owner dies isn’t particularly complicated, but how it happens depends on their redemption value.

The Probate Estate

Probate is required by law if the total value of your parent’s U.S. Treasury securities -- including any bills or notes he may have owned in addition to the bonds -- is more than $100,000 as of the date of death. In this case, the bonds would go to his probate estate. You won’t have to do anything about cashing them in unless you’re the executor of the estate. It would happen as part of the probate process.

Warning

  • If probate is necessary to deal with your parent’s other assets, the bonds can only be paid to the estate in this case as well, even if their value is $100,000 or less. You can’t legally cash them in yourself.

Cashing in the Bonds

If probate isn't necessary, you can cash the bonds in yourself. Go online to the TreasuryDirect website and download Form 5336 – Disposition of Treasury Securities Belonging to a Decedent’s Estate Being Settled Without Administration. Complete the form and sign it in front of a certifying official -- most bank officers qualify. Mail the bond, the form and a certified copy of the death certificate to the Treasury Retail Securities Site in Minneapolis – an address is provided on the Treasury Direct website. You can only do this if your other parent is also deceased – otherwise, she's the only one entitled to cash in the bonds.

Electronic Bonds

If your parent owned electronic bonds, the process for cashing them in is different because this means he had an online TreasuryDirect account. TreasuryDirect suggests calling the Bureau of Fiscal Service for assistance. A hold will be placed on the account and you'll be given specific instructions on how to close it. You can send an electronic message to the BFS on the website.

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