Putting savings bonds into a trust
Friday, January 7th, 2005
Categorized as: Inheriting and bequeathing US Savings Bonds • Savings Bond registration changes
I’m looking for the form I need to put my savings bonds into a family trust.
Tom’s response
Before rushing off to put your Savings Bonds in a Trust, be sure to read my post on Trusts: Savings Bonds, estate planning, living trusts, and avoiding probate.
If you decide to go ahead, what you’re looking for is Public Debt Form 1851 Request to Reissue United States Savings Bonds to a Personal Trust.
Read the instructions carefully. To avoid paying income tax on your savings bonds’ accumulated interest, you have to certify that under the trust, you will be treated as the owner of the portion of the trust represented by the tax-deferred accumulated interest on the bonds being reissued.
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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.
Tom Adams
I was wondering if you could tell me where I can get Public Debt Form 1851?
Shirley
Shirley - there’s a link to the form you’re looking for in the text at the top of the this page. You just have to click on it.
Tom Adams
i want to gift my savings bonds to my grandchildren either for their college education or upon my death. do i want to reissue the bonds with their names as a co-owner (or beneficiary) since my husband (original co-owner) is deceased or what would a trust do for us? thanks for your input.
Eileen - Just get the bonds reissued with your grandchildren as beneficiaries; a trust is a pretty complicated way to do this. There’s more info here on getting the bonds reissued to add a beneficiary.
Tom Adams
Series EE Savings Bonds. My bonds have my father who is deceased as the co-owner. How do I go about removing my father’s name and substituting my wife as the co-owner?
Vincent - the information you’re looking for is on my page about changing a co-owner who has died.
Tom Adams
Can I-Bonds purchased in individual names/SSNs in electronic form (Treasury Direct) be reissued in the name of a Family Trust? The Treasury Direct web site indicates that I-Bonds can only be purchased in individuals names/SSNs, not in the name of a trust at purchase.
Bill - Only paper Savings Bonds can be issued in the name of a Trust. At this time electronic bonds on TreasuryDirect can only be issued in the name of individuals who have SSNs. Electronic bonds cannot be reissued as paper bonds, so there’s no way to move the money into a Trust without cashing the electronic bonds and buying new paper bonds (but in that case, beware the annual purchase limits).
Tom Adams
Thank you. This was more helpful than the treasury site.
My mom purchased I bonds in her name with her trust as POD. My sister and I would like to keep the bonds without having to cash them in and purchase another because they were purchased in 2003 and the rate is good. Can we just get them reissued one in my name and one in my sister’s name?
Lisa - Typically you can get bonds reissued in a new name when the owner dies.
However, having a Trust as the POD is highly unusual - I didn’t know it was even possible.
But if that is the case and the bonds belong to the Trust, the Trust can ask that the bonds be reissued to you and your sister.
However, you should ask if this will be a taxable event to the Trust. Typically this kind of transaction doesn’t create a taxable event, but this situation isn’t typical.
Tom Adams