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TREASURY SECURITIES & PROGRAMS

I Savings Bonds

As of January 1, 2012, paper savings bonds are no longer sold at financial institutions.  This action supports Treasury’s goal to increase the number of electronic transactions with citizens and businesses. See the press release.

I Bonds are a low-risk, liquid savings product. While you own them they earn interest and protect you from inflation. You may purchase I Bonds via TreasuryDirect or with your IRS tax refund. As a TreasuryDirect account holder, you can purchase, manage, and redeem I Bonds directly from your Web browser.

Use I Bonds to:

  • Finance education
  • Supplement retirement income
  • Give as a gift
at a glance
Current Rate: 1.38% through April 30, 2014
Minimum purchase: $50 for a $50 I Bond when purchasing
paper bond certificates with your IRS tax refund

$25 for a $25 I bond when purchased electronically via TreasuryDirect
Maximum purchase
(per calendar year):
$10,000 in TreasuryDirect and $5,000 in paper bonds purchased with IRS tax refunds
Denominations: Paper bonds with your tax refund: $50, $100, $200, $500, $1,000, and $5,000

Electronic bonds via TreasuryDirect: purchase to the penny for $25 or more
Issue Method: Paper bond certificates with your tax refund or electronic issue in TreasuryDirect accounts

Rates & Terms

  • I Bonds have an annual interest rate that reflects the combined effects of a fixed rate and a semiannual inflation rate. They are an accrual-type security. Interest, if any, is added to the bond monthly and is paid when you cash the bond.
  • I Bonds are sold at face value; i.e., you pay $50 for a $50 bond.

Redemption Information

  • Minimum term of ownership: 1 year
  • Interest-earning period: 30 years
  • Early redemption penalties:
    • Before 5 years, forfeit 3 most recent months' interest
    • After 5 years, no penalty

Tax Considerations

  • Interest on savings bonds is subject to taxes imposed under the Internal Revenue Code of 1986. The bonds are exempt from taxation by any State or political subdivision of a State, except for estate or inheritance taxes.
  • Interest earnings are subject to Federal income tax.
  • Interest earnings may be excluded from Federal income tax when used to finance education (see education tax exclusions).

I Bond-Related FAQs

  • How is the earnings rate of an I Bond determined?
  • What is the difference between EE and I bonds?
  • Are there tax benefits to using I Bonds to finance education?
  • Can I give an I Bond as a gift?
  • Can I ever lose money in I Bonds?

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