How to Cash Series EE Bonds: Methods, Taxes, and Inheritance

To cash Series EE savings bonds, take paper bonds to a bank where you have an account, mail them to Treasury Retail Securities Services with FS Form 1522, or log in to TreasuryDirect and redeem electronic bonds online. You need to have held the bond at least 12 months (six months for bonds issued on or before January 1, 2003), and cashing before five years costs three months of interest. The interest is taxable federally but exempt from state and local income tax, and you generally report all of it in the year you redeem.

Confirm the Bond Is Eligible and Check Its Value

Bonds issued on or after February 1, 2003, must be held for 12 months before redemption. Older bonds have a six-month minimum.¹ The issue date printed on a paper bond, or shown in your TreasuryDirect account, is what counts.

Redeem a bond less than five years after its issue date and the Treasury deducts three months of interest from your payout. A bond cashed at four years and six months earns four years and three months of interest. After five years, the penalty is gone.¹

Every Series EE bond stops earning interest 30 years after its issue date.¹ Bonds past that point are dead money. They still owe federal tax on the accumulated interest, and they are not growing while you wait.

To see what a paper bond is worth today, use the Savings Bond Calculator on TreasuryDirect.gov. Enter the series, denomination, and issue date, and it returns the current redemption value, total interest, and maturity date.² For electronic bonds, the value shows inside your TreasuryDirect account.

Cashing Paper Bonds at a Bank

Many banks and credit unions act as paying agents for the Treasury and will cash paper EE bonds on the spot. Bring the bond and a valid government-issued photo ID such as a driver’s license or passport. You sign the back of the bond in front of a bank employee, who witnesses the signature. Payment is usually immediate, in cash or by deposit.

One catch: not every bank cashes bonds for walk-ins who don’t have an account there. Call before you go, and start with your own bank or credit union. A paper bond must also be redeemed for its full face value. You cannot cash part of a paper bond and hold the rest.³

Cashing Paper Bonds by Mail

If no bank works, mail the bonds to Treasury Retail Securities Services with FS Form 1522. Download the form from TreasuryDirect.gov, complete it, and sign it. If the total redemption value is $1,000 or less, you don’t need a certified signature; include a copy of your driver’s license, passport, state ID, or military ID. Above $1,000, sign the form in front of a notary or authorized certifying officer, who stamps or seals it.⁴

Mail the signed form and the bonds to the address printed on FS Form 1522. The Treasury sends your 1099-INT the following January.⁵

Cashing Electronic Bonds in TreasuryDirect

Electronic bonds are simpler. Log in to your TreasuryDirect account, open Manage My Securities, and pick the bonds to redeem. The system displays the current redemption value and asks you to confirm. Funds land in the bank account linked to your profile, generally in one to two business days. Electronic bonds can be redeemed in part, so you can cash some of the value and let the rest keep earning.³

Federal Tax on the Interest

Interest on Series EE bonds is subject to federal income tax and exempt from state and local income tax in every state.⁶

You choose when to report. Most people defer until the year the bond is cashed or reaches final maturity, whichever comes first, and take the full tax hit in one year. The alternative is to report interest each year as it accrues. If you go annual, you must do the same for every savings bond you own going forward, and you need records of interest already reported so you don’t pay tax on it again at redemption.⁷

Cash a paper bond at a bank and the bank issues the 1099-INT. Mail bonds in and the Treasury sends the 1099-INT by January 31 of the following year. For electronic bonds, the 1099-INT posts inside TreasuryDirect by the same date.⁵ If your total taxable interest for the year exceeds $1,500, file Schedule B with your return.⁷

Using EE Bonds for Education to Avoid Tax

You may be able to exclude some or all of the interest from federal tax when you use the proceeds for qualified higher education expenses for yourself, your spouse, or a dependent. The requirements are narrow:

The bond must have been issued after 1989.
The bond owner must have been at least 24 years old when the bond was issued. Bonds registered in a child’s name never qualify, even after the child grows up.
Married filing separately does not qualify.
Your modified adjusted gross income must fall below annually adjusted thresholds. For tax year 2025, the exclusion begins to phase out at $99,500 for single filers and $149,250 for joint filers, and phases out completely at $114,500 and $179,250. Thresholds for 2026 will appear on the updated IRS Form 8815.

Claim the exclusion on Form 8815 filed with your tax return.⁸ Qualified expenses must be paid at an eligible institution in the same tax year you cash the bonds, and you must reduce those expenses by any scholarships or other tax-free educational benefits.⁹

Cashing Bonds After the Owner Has Died

If the bond names a beneficiary and the owner has died, the beneficiary becomes the sole owner and can request payment by submitting proof of death.¹⁰ If the bond names a co-owner, the surviving co-owner can cash it.

When bonds pass through an estate, procedure depends on the total value of the deceased’s Treasury securities. If that total redemption value as of the date of death is $100,000 or less and no formal estate administration is underway, a voluntary representative can act. The Treasury follows a priority order: surviving spouse first, then children, parents, siblings, and so on.¹⁰ The voluntary representative submits FS Form 5336, signed in front of a certifying official, with a certified copy of the death certificate.¹¹

Above $100,000, formal estate administration is required. The court-appointed executor or administrator must present letters of appointment dated within one year of submission.¹⁰

Avoiding Double Tax on Inherited Interest

If the deceased had been deferring interest (as most people do), all of it is still owed to the IRS. Two options exist. The estate can report interest earned through the date of death on the decedent’s final return, leaving the beneficiary responsible only for interest earned afterward. Or the beneficiary can cash the bond, receive a 1099-INT for the full lifetime interest, and reduce the taxable amount by whatever was reported on the decedent’s return.⁶ IRS Publication 550 shows how to document that adjustment. Skip the adjustment and you pay tax twice on the same interest.

1
eCFR. 31 CFR Part 351 Subpart B – Maturities, Redemption Values, and Investment Yields of Series EE Savings Bonds
2
TreasuryDirect. Savings Bond Calculator
3
TreasuryDirect. Cash EE or I Savings Bonds
4
TreasuryDirect. FS Form 1522 – Special Form of Request for Payment of United States Savings and Retirement Securities
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TreasuryDirect. 1099 Tax Statements for Paper Savings Bonds and TreasuryDirect
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TreasuryDirect. Tax Information for EE and I Bonds
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Internal Revenue Service. Savings Bonds 1
8
Internal Revenue Service. Form 8815 – Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued After 1989
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TreasuryDirect. Savings Bonds Using Bonds for Higher Education
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eCFR. Subpart L – Deceased Owner, Coowner or Beneficiary
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TreasuryDirect. Non-Administered Estates