i bonds interest

[LivingAlmostLarge]

For anyone who owns bonds when do you pay taxes on the interest. Annually? Or when you redeem? Which did you pick and why? I can't figure out how to do it. All i know is i have $60k in ibonds and it's getting some sort of interest but it's my backup EF

[disneysteve]

Taxes are paid upon redemption.

[scfr]

Re i bonds specifically: You have choices. See the link to the Treasury Direct web site.

I pay "upon redemption." I chose that to defer taxes and to have a bit of control (or at least the illusion of control) of the tax rate. Plus it's easier to track.

I decided to redeem some last year because of our marginal tax rate. The interest I had earned the entire time I had them was reported on my Form 1099-INT that I get from the Treasury Direct web site, and I reported it on my Schedule B. So the taxes on the interest weren't literally paid when I redeemed them, but became part of our 2019 tax year return.

I say "I" but they are jointly owned. It's just that my DH has zero interest in our Treasury holdings. The TIPS and IBonds and EE savings bond are my thing.

[james.hendrickson]

Five words: BRING BACK PAPER SAVINGS BONDS.

[scfr]

Five words: BRING BACK PAPER SAVINGS BONDS.

Do you know that you can buy paper savings bonds with your tax refund if you get a refund?

[kork13]

I elected to defer the taxes, for 2 reasons: (1) control over the tax bill; (2) it's easier. The default is to pay taxes on redemption. So the only way to pay the taxes on it annually is to manually report it on your taxes each year, and maintain the records of doing so because Treasury Direct only reports the 1099INT upon redemption, so you have to prove that the taxes were previously paid.

[LivingAlmostLarge]

thank you!