Bonds» Current Rates, News & Information

If you are wondering whether Savings bonds are taxed or not, there are general rules that owners of Savings bonds must adhere to. According to the US Treasury website:

• Interest earnings are exempt from State and Local tax
  
• Interest earnings are subject to Federal income tax but can be deferred until the cash in date
  

If bonds are cashed out and the money is used specifically to finance the cost of higher education for an individual, spouse or child, taxes on Savings bonds may be waived. However, it is important for an individual to verify the terms of their savings bonds with their tax preparers to ensure that they are completing their tax information accurately.

The reason that taxes on Savings bonds do not have to be paid at the State and local level is because the U.S. Treasury issues savings bonds. Investors redeeming savings bonds will receive a 1099-INT form in the tax year of that transaction.

The interest gained on Savings bonds is never considered a capital gain and the interest are deferred until the bonds are redeemed. However, the interest still counts as income and can be taxed accordingly to your tax bracket.

Ultimately Savings bonds are not as appealing as stocks or other investments in terms how much possible gains investors can make. But with the comfort level of what Savings bonds can provide with virtually no risk and tax breaks - what more can a low risk investor ask for? And yes, Federal taxes may need to be paid on the investment, however, taxes on Savings Bonds can be significantly less then other types of taxes from investments (especially capital gains taxes).

Prior to World War I, the government financed their bankroll for participating in wars by borrowing money from other countries. However, in 1917, the international banks were closed and the basis for our savings bond system was launched.

Like other predecessor bonds, Patriot bonds are marketed as another tool allowing Americans to support our wars. The proceeds of this particular bond are applied towards funding anti-terrorism efforts. The profits are deposited into a general fund. Ultimately the money funds anti-terrorist causes and must follow legal guidelines before being spent.

Patriot bonds were introduced December 10, 2001. Except for the words "Patriot Bond" embossed on the top portion of the bond (between the Social Security Number and issue date) they are identical in payment, maturity, terms and interest structure to the paper EE Savings bond.

Patriot bonds are available for purchase in any amount of $25 or more (including penny increments). An individual can purchase up to $5,000 of any savings bond annually as that is the maximum amount per social security number.

According to the US Treasury, Patriot bonds earn interest as follows:

• Bonds issued after May 2005 earn a fixed rate of return.
• Variable rates for bonds bought from May 1997 through April 2005 are based on 90% of the 6-month averages of 5-year Treasury Securities yields
• Interest compounds semiannually for 30 years

Like the EE Series Savings bonds, Patriot bonds can benefit from certain tax benefits when they are cashed in. Patriot bonds are exempt from state and local income tax (but not federal tax). Participants in the savings bond program may be entitled to more tax benefits when the bonds are cashed out to pay for higher education costs.

The US Treasury offers two categories of government securities available for investment options for US citizens. The government offers marketable treasury securities that are available to be traded on the secondary market. Additionally there are non-marketable Treasury products, such as I...

To understand what a HH Savings bond is, you must understand the whole network of government securities issued as a whole. Like all US savings bonds, HH Savings bonds are considered a non-marketable Treasury security. In general, they are government bonds issued by the US Department of the...

For decades US Savings bonds have been a safe and effective way for consumers to invest their money while providing loans to government agencies that were strapped for cash. Aside from ensuring that your principal will not be depleted and offering a relatively decent rate of return, US Savings...

With changing market conditions, it is extremely challenging to figure out the best place to invest your money.

An EE Bond is a low-risk investment options backed by the US government that generate a fixed rate on return. They have the funds of the US reserves behind them and can be used as...

When you think of making investments, it's hard not to think of the word bond as well. Along with stocks, bonds are probably one of the most well-known ways to invest money.

But what are they exactly? And how are they utilized to make investors money? We will explore the basics of the investment...

Since the inception of the US Savings Bond program in the 1930's, savings bonds have been issued sequentially in alphabetical order. Starting at the letter "A" and working their way through the alphabet. The bonds include "E Savings Bonds ."

E Savings Bonds (EE/E) are a safe, government issued, ...

One tool that can be used to help with saving for your kid's college education is Education Bonds.

Since the 1930's US Savings Bonds have been a safe and secure way for consumers to invest their money with no loss to their principal and a guaranteed return on the investment. To use the ...

Investors are currently scrambling trying to find safe ways of diversifying their portfolios and to earn a return for their investments. Treasury direct bonds are an option worth considering after you educated yourself on the advantages of this type of investment.

Treasury direct bonds have been...