Series H/HH Savings Bond overview

Monday, October 25th, 2004
Categorized as: Series HH or H US Savings Bonds

Series H and HH bond overview

New Series HH or Series H Savings Bonds are no longer issued, however, there are HH bonds outstanding that are still earning interest. All series H bonds, on the other hand, are no longer earning interest and should be redeemed.

HH bonds feature current income. This means they don’t grow in value like other Savings Bonds. At redemption, Series H and HH bonds are worth only their face value.

Instead of being added to the value of the bond, the interest an HH bond earns is paid to you twice a year, usually by direct deposit into your bank account. The payment is made in the anniversary month of the bond and six months later.

When they were available, the only way to obtain Series H/HH Savings Bonds was in exchange for Series E or EE Savings Bonds.

The other major feature of Series HH and Series H Savings Bonds is that they allow you to continue tax deferral on the interest income from the E/EE bonds that you exchanged for the H/HH bonds. This tax-deferral lasts until the H/HH Bonds are redeemed or stop earning interest.

H/HH bonds were issued at full face value (you paid $500 for a $500 bond). Series H/HH Savings Bonds were available in four denominations: $500, $1,000, $5,000, and $10,000.

Series H bonds were first issued in June 1952 and earned interest for 30 years. They were replaced by Series HH Savings Bonds in January 1980. Series HH bonds earn interest for 20 years.

You can have Series HH and Series H Savings Bond interest payments deposited directly into your bank account. Use the Treasury’s Direct Deposit Sign Up Form, to initiate direct deposit.

Unlike other series of Savings Bonds, Series H/HH bonds don’t have a three-month interest penalty when they are redeemed before five years.

Savings Bond Advisor will also help you avoid a hidden interest rate penalty that can occur if you cash a Series H/HH bonds at the wrong time.

Are you missing interest payments?

If you have inherited or otherwise own Series H or Series HH Savings Bonds and you’re not receiving interest payments, you need to notify the Treasury in writing.

Provide the date and amount of the missing interest payment, if known. You must also provide the name and social security number on the bonds. Sign the notification and send it to:

HH/H Assistance Branch
Bureau of the Public Debt
PO Box 2186
Parkersburg WV 26106-2186

It usually takes two to three weeks to receive a response to a missing interest payment inquiry.

Are 1.5% HH bonds worth keeping?

The Treasury has the right to change the interest rate on H/HH bonds every ten years. For bonds reaching their tenth anniversary now, the rate drops from 4% to a mere 1.5%.

My book, Savings Bond Advisor, includes an extensive analysis of 1.5% H/HH bonds. Many people are better off redeeming 1.5% bonds, paying the tax, and reinvesting in EE or I bonds. See the book for complete details.

Sample Series HH Savings Bond

Series HH Savings Bonds - $500 Face Value - George Washington

Series H/HH tax issues

On the face of a Series HH or Series H Savings Bond you’ll see a section labeled deferred interest. When an HH bond is redeemed, the owner or co-owner who redeems the bond receives the face value of the bond and the owner or co-owner who has been receiving the interest payment, along with the IRS, receives a 1099-INT tax form reporting the amount of deferred interest shown on the bond.

The amount shown on the 1099-INT is the interest from the Series E/EE bonds that were converted into Series H/HH bonds and never paid.

This means that if you have a large investment in H or HH bonds, you need to be aware of the deferred-tax time-bomb, which is discussed in detail in Savings Bond Advisor.

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FDIC Insured Certificates of Deposit can pay 1 or 2% more than savings bonds when held for a similar length of time. See top CD Rates Below:


On April 14th, 2010 Steven Brown said:

If you are a co-owner on an HH deferred-tax time-bomb, and the owner who has been collecting the interest passes away, can the co-owner immediately cash it and claim the deferred interest on the final taxes of the deceased. The treasury web site seems to indicate this is possible. It would be very beneficial as the deceased person’s final tax bracket will be 15% versus the co-owner being in a 33% bracket.

On April 15th, 2010 Tom Adams said:

Steven – it would be the Executor of the estate who would do this, not the co-owner, unless they happen to be the same person.

Tom Adams

On April 19th, 2010 Bernie Lieb said:

If a person dies with savings bonds in his estate, does he have to pay taxes on the interest on the bonds on the fed. tax return for the year in which he died as well as taxes on the interest on the bonds on his estate tax return?

On April 20th, 2010 Tom Adams said:

Bernie – If the Savings Bonds are still paying interest, the income tax on the interest the bonds have earned doesn’t have to be paid on the final return, although often that makes sense. I think I answered the rest of your question for you yesterday here.

Tom Adams

On May 24th, 2010 Tony James said:

I just mailed in a $5,000 H/HH Savings Bond to Pittsburgh, Pa. for a cash out to be received as a direct deposit to my checking account. It was issued on January 1, 2001. What will my deposit show – $5,000 or more with interest accrued? And, how long does it normally take to find the money deposited into your account? Many thanks.

On May 25th, 2010 Tom Adams said:

Tony – The HH bond does not grow in value – you’ve been receiving interest payments every six months – so you’ll get exactly $5,000. The standard of service for payment is three weeks.

Tom Adams

Comments Closed

June 1, 2010

After six years, over 400 posts, 3,680 real comments, and over 90,000 spam comments (thank you, Akismet, for making managing a blog with comments possible), I am closing public comments on I will contine to update the main articles on this site, but not the comments.

Virtually every question about Savings Bonds has been asked and answered on this site multiple times. Use the search feature (see the box in the gray area near the top of this page) or the detailed menu on the lower part of the home page to find the information you're looking for. If you have a copy of Savings Bond Advisor, you can ask me a question here.

Tom Adams

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