Claiming Series EE Bonds on Your Taxes

Series EE bonds have been one of the most popular forms of investment for many years because of their simple investment process. You buy them for half of the face value of the bond and then hold them. They will provide you with a 100 percent return on investment over time. If you own Series EE bonds, you may be wondering how to properly handle the tax issues associated with them. Here are the basics of claiming the interest that you earn from your Series EE savings bonds.

Flexibility of Reporting

With the Series EE savings bond, you actually have quite a bit of flexibility in when you report the interest on the bonds. One option is to report it in the year that you earn it. You can determine exactly how much interest was earned on the year and report that amount on your taxes. 

The other option is to wait until you cash in the savings bond and then report all of the interest at once. This is the most popular option because it allows you to wait until you have the money from the bond to pay the taxes. 

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