Tax-deferred rollovers of EE to I Savings Bonds
Thursday, February 10th, 2005
Categorized as: Savings Bond taxes • Series EE US Savings Bonds • Series I US Savings Bonds
Can EE savings bonds be converted to I bonds without having to pay taxes on the interest earned? Is there any way to rollover EE bonds into something else and not pay tax on the earnings of the EE bonds?
Tom’s response
The only way to move your money between Series EE and Series I bonds is to redeem one and purchase the other. This always creates a taxable event.
Now that HH bonds aren’t available, there’s no longer any way to continue tax-deferment after a Savings Bond reaches final maturity and stops paying interest. No rollovers, no sign-overs, no do-overs.
You know that saying about death and taxes? Meet taxes.
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Tom Adams
With the way the market is why doesn’t the goverment give a break to those of us that have EE bonds that is no longer earning intrest. I am in my sixty and is waiting until I don’t have to pay so much taxes
Hi Shirley – have you written your Congressional Representative about this?
Most of what happens in Washington happens because of lobbyists, and Savings Bonds holders have none. So we are always at the end of the line.
Tom Adams
Shirley – you are losing money by not receiving any interest on those EE Bonds. It may more than taxes, especially if your tax rate is low. You may wish to sell at least some and reinvest in I Bonds at these present rates.
If the bonds have reached final maturity and are no longer earning interest, then you owed the income tax on accumulated interest in the year they reached final maturity. Delaying redemption of bonds past final maturity doesn’t delay the tax liability.
Can you use the ee bonds to educate your self after retirement and take classes you always wanted to take but couldn’t. What about fun stuff like the art of salmon fishing in alaska?
GayNell – You can use the deduction for your own college tuition (some college somewhere must offer that course, but you can’t deduct travel expenses) if you can meet the many other limitation of the deduction.