Redeeming 100 Savings Bonds

Tuesday, November 2nd, 2004
Categorized as: Cashing in US Savings Bonds

We have a client who has more than 100 Savings Bonds she would like to redeem. She is unable to sign very easily and certainly would not be able to sign every bond. Is there a process which would only require minimal signing?

Tom’s response

When you want to redeem more than just a few bonds, rather than asking a bank to certify your signature on each one, it’s easier to list all the bonds on Public Debt Form 1522 and have the bank certify your signature on the form rather than on each bond.

However, please advise your client that unless all these bonds have stopped earning interest, cashing in this many bonds all at once will probably cause her to pay more income tax than she needs to.

People in her position typically save a relatively large amount of money by reading the chapter in my book called Managing the deferred-tax time bomb before completing this kind of transaction.

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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:


[…] If you have a large number of bonds, see my post Redeeming 100 Savings Bonds. […]

On June 18th, 2008 Virginia Stone said:

years ago we bought our granddaughter us saving bonds and some where in her name and her mothers, but just a few where in our granddaughter name with mine on them. She is off to college Aug 21, We wanted to know (as we were told once) if that we could pay these straight to the school and not pay taxes on the interest? Is this true or is there a way for her college education that when she cash them in for her college tution that will prevent her from having to pay taxes on the interest. Please if you can help me I need to know asap thanks so much. Virginia Stone

On June 19th, 2008 Tom Adams said:

Virginia – you can’t give the bonds directly to the school. You need to cash them at a bank and give the school the money. To get a tax deduction, the bonds have to registered in the name of the parents. Full info here.

Tom Adams

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June 1, 2010

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Tom Adams

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