However, all of the accumulated interest on U. This must be reported on your tax return. Even if you do not receive a tax statement or Form you are still responsible for reporting all taxable interest income on your tax return. The IRS is notified electronically of all interest paid by financial institutions to bond holders. If you do not include your interest income on your tax return, you will be notified by the IRS, usually by mail, of the amount of additional tax, interest, and penalties you owe.
This document provides statements or interpretations of the following laws and regulations enacted as of February 9, Sections Tax 3. Code, and 31 U. Laws enacted and in effect after February 9, , new administrative rules, and court decisions may change the interpretations in this document.
You may, for example, find it advantageous to report interest every year on savings bonds in a child's name. The child may be paying taxes at a lower rate than will be true years later when the bond matures. Note: You or the child if a bond is in the child's name do not actually receive the interest every year even if you report it that way. The interest that the bond earns is reported on a INT after the bond is cashed or is reissued to reflect a taxable change in ownership.
The INT will show all the interest the bond has earned over the years. Once you start to report the interest every year for example, for a child in the child's Social Security Number , you must continue to do so every year after that for all your savings bonds or, for example, the child's bonds and any you acquire or, the child acquires in the future. Our online Savings Bond Calculator can also help you determine the year-to-date earnings for the calendar year.
Whether you are reporting interest at the end of the bond's life or every year, you report the interest from your bonds on your federal income tax return on the same line with other interest income. If you are reporting the interest on bonds another person owns for example, the interest on your child's bonds , you report that on the other person's federal income tax return with other interest income that person has earned.
If you choose to report interest every year, after the bond is cashed, the INT will show all interest earned from date of issue. See instructions in IRS Publication on how to report interest in this situation on your federal income tax return.
Department of the Treasury, Bureau of the Fiscal Service. Other Treasury Securities. I Savings Bonds Buy. Emma Watkins writes on finance, fitness and gardening. Watkins holds a Master of Arts in psychology. At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system.
These returns cover a period from and were examined and attested by Baker Tilly, an independent accounting firm. Visit performance for information about the performance numbers displayed above. More Articles 1.
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