Book Notes for Savings Bond Advisor: November 2006 Edition

Update: On May 17, 2006, President Bush signed a new tax law that in its fine print raised the age of the kiddie tax to 18 from 14. Please take a pencil to pages 165 and 166 of this edition and change “14” to “18” in the five places it occurs. For more information, see Tax law change impacts kiddie tax and Roth IRAs. The change is retroactive to January 1, 2006.

Introduction – Is this book for you?

• I-1 – Figure updated monthly: Value of equal monthly investments in I Bonds and the stock market

Chapter 1 – An Introduction to Savings Bonds

• 1-1 – How the Treasury calculates Savings Bond interest payments

Chapter 2 – Why Savings Bonds?

• 2-1 – Amazon link to The Coming Generational Storm, by Lawrence J. Kotlikoff and Scott Burns
• 2-2 – Link to Kotlikoff’s ESPlanner web site
• 2-3 – Today’s interest rate quotes
• 2-4 – Current Series I Savings Bond rate
• 2-5 – Current open market rates for TIPS at 5-, 7-, and 10-year maturities.
• 2-6 – Other ways to invest in Treasury securities: Vanguard | iShares
• 2-7 – Open a TreasuryDirect account for marketable Treasury securities.
• 2-8 – Treasury web site for T-Bills, T-Notes, and TIPS.
• 2-9 – Tentative schedule of upcoming Treasury auctions.

Chapter 3 – Today’s choices – Series I and Series EE

• 3-1 – Series I bond fixed base-rate component update
• 3-2 – Historical interest rate tables, updated daily by the Federal Reserve
• 3-3 – Series I bond inflation component update
• 3-4 – Amazon link to The Wisdom of Crowds, by James Surowiecki
• 3-5 – Figure updated monthly: Amount invested in Savings Bonds.

Chapter 4 – How to invest in Savings Bonds

• 4-1 – The Treasury’s list of banks that offer Savings Bonds online has been discontinued.
• 4-2 – The Treasury’s list of restricted countries
• 4-3 – Public Debt Form 3062-4 – Claim for United States Savings Bond not received
• 4-4 – Savings Bond gift certificates

Chapter 5 – Whose name goes on the bond?

Chapter 6 – All about TreasuryDirect

• 6-1 – Use this form to send an email to TreasuryDirect.
• 6-2 – Treasury Direct; terms and conditions.
• 6-3 – Treasury Direct; privacy and security notices.
• 6-4 – Treasury Direct; open a new account.
• 6-5 – The latest version of the Internet Explorer browser for Windows | Macintosh
• 6-6 – The latest version of the Firefox (Mozilla) browser for Windows | Macintosh | Linux
• 6-7 – The latest version of the Opera browser for Windows | Macintosh | Linux | more
• 6-8 – Entrust’s list of supported browsers
• 6-9 – Treasury Direct; access your account.

Chapter 7 – Savings Bond A, B, Cs

• 7-1 – Direct deposit sign up form – Public Debt Form 5396
• 7-2 – H/HH Internet Services – View your accounts, change your address, get tax information

Chapter 8 – How much are my Savings Bonds worth?

• 8-1 – GBonds – a Savings Bond calculator for GNOME/Linux.
• 8-2 – The Treasury’s Savings Bond Calculator
• 8-3 – Right-click on the following link and select Save Target As from the menu that appears on your screen US Savings Bond Wizard. If you have trouble downloading the file, try a normal click. If that doesn’t work either, the Treasury has additional download tips here.

Chapter 9 – Keeping track of your Savings Bond inventory

• 9-1 – Download Savings Bond Inventory template for Microsoft Excel (Don’t Open this file immediately, first Save it on your own computer, then open it.)

Chapter 10 – Savings Bonds and estate planning

• 10-1 – New York Attorney General’s page on Living Trusts

Chapter 11 – Inheriting Savings Bonds

• 11-1 – Public Debt Form 4000 – [As of Aug 1, 2006, Form 5387 has been discontinued, use Form 4000]
• 11-2 – Public Debt Form 4000 – Request to reissue United States Savings Bonds
• 11-3 – Public Debt Form 1455 – Request by Fiduciary for Reissue or Distribution of United States Savings Bonds
• 11-4 – Public Debt Form 2513 – Application by Voluntary Guardian of Incapacitated Owner of United States Bonds or Notes
• 11-5 – Public Debt Form 1522 – Special Form for Request of Payment of United States Savings and Retirement Securities Where Use of a Detached Request is Authorized
• 11-6 – Public Debt Form 5394 – Agreement and Request for Disposition of a Decedent’s Treasury Securities
• 11-7 – Public Debt Form 5336 – Disposition of Securities Belonging to a Decedent’s Estate Being Settled without Administration

Chapter 12 – Changing the registration

• 12-1 – Public Debt Form 1851 – Request to reissue United States Savings Bonds to a personal trust
• 12-2 – Public Debt Form 4000 – [As of Aug 1, 2006, Form 5387 has been discontinued, use Form 4000]
• 12-3 – Public Debt Form 4000 – [As of Aug 1, 2006, Form 1938 has been discontinued, use Form 4000]
• 12-4 – Public Debt Form 4000 – Request to reissue United States Savings Bonds
• 12-5 – IRS Publication 550 – Investment Income and Expenses

Chapter 13 – Lost and stolen Savings Bonds

• 13-1 – Treasury Hunt
• 13-2 – Public Debt Form 3062-4 – Claim for United States Savings Bond not received
• 13-3 – Military safekeeping contact list
• 13-4 – Public Debt Form 1048 – Claim for lost, stolen, or destroyed United States Savings Bonds
• 13-5 – State lost property database – Search the unclaimed property databases kept by state attorney general offices

Chapter 14 – Managing the deferred-tax time bomb

• 14-1 – The most current US Tax Rate table
• 14-2 – IRS Publication 17
• 14-3 – Form to reinstate tax-deferral – If you’ve been granted permission to pay interest on your Savings Bonds every year, use this form to get automatic permission from the IRS to switch back to deferring interest. But beware: you are setting a double-taxation trap.

Chapter 15 – Is tax-deferral better than higher rates?

Chapter 16 – Basics of Savings Bond redemption

• 16-1 – Public Debt Form 1522 – Special Form for Request of Payment of United States Savings and Retirement Securities Where Use of a Detached Request is Authorized
• 16-2 – Public Debt Form 5188 – Durable Power of Attorney for Securities and Savings Bonds Transactions
• 16-3 – Savings Bond disaster relief – Counties eligible for lifting of the one-year holding period
• 16-4 – IRS Form 1040-ES – Estimated tax payments
• 16-5 – Electronic Federal Tax Payment System (EFTPS)
• 16-6 – Public Debt Form 5396 – Direct Deposit Sign Up Form

Chapter 17 – How to minimize the income tax bite

• 17-1 – IRS Publication 970 – Tax Benefits for Education.
• 17-2 – IRS Form 8815 – calculates the two phase outs for the Savings Bond education deduction; IRS Form 8818 – an optional form for recording the data on the bonds you cashed in.
• 17-3 – IRS Publication 526 – Charitable Contributions.

Appendix – How to obtain the forms you need

• 18-1 – Savings Bonds Forms Ordering – An online order form you can use to receive free paper copies of Savings Bond forms in the mail
• 18-2 – Public Debt Form 1522 – Special Form for Request of Payment of United States Savings and Retirement Securities Where Use of a Detached Request is Authorized