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Home / Services / Calculators / Newsletter / Archives U.S. Savings Bonds U.S. Savings Bonds that were purchased in 1973 will mature this year. This means the Treasury department will stop paying interest to you on them this year. Unless you enjoy loaning money to the government and not earning any interest on the loan, you will be forced to choose either to cash them in or swap them for Series HH Bonds. If you choose to cash them in, you will be subject to Federal Income Tax on the interest that has accumulated on the bond since you purchased it. Ohio will not tax this interest, nor is it subject to taxation by cities in Ohio. The amount of interest is calculated by deducting one-half of the face value of the bond from the redemption amount. If you choose to swap them for Series HH Bonds, you may elect to defer reporting the interest earned by the Series E Bond until the Series HH Bonds are cashed in, stop earning interest in 20 years, or are reissued. The Series HH Bonds are issued in $500, $1,000, $5,000 and $10,000 denominations. If the value of the E or EE bonds you are exchanging is not an exact multiple of $500, you may make up the difference with other funds, or may choose to receive any excess cash. Any money that you receive will be taxable. There is no limit on the amount of Series HH Bonds you can acquire in a calendar year. You may check the value of your Savings Bonds at the U.S. Treasury website or click on the link in our website at www.newlandcpa.com
(May, 2003 Newsletter)
James E. Newland, CPA 939 Center Road Eastlake, Ohio 44095 440-951-9799 |
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