Moving I bonds to "Custom" I bonds account

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BogleMelon
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Moving I bonds to "Custom" I bonds account

Post by BogleMelon » Fri Jan 05, 2018 2:44 pm

I have some I bonds that I need to manage better. Treasury Direct "as I learnt here" has the option to open a sub account (they call it custom account) that sub account can only be managed if I logged in to my main account first.
So i created that sub account and now I want to move some i bonds from the main account to the newly open sub account. Just before hitting the submit button, I noticed this disclaimer:
By clicking the SUBMIT button below: I understand this security will be removed from my account and transferred to the recipient's TreasuryDirect account. I further understand that this transfer may result in a tax liability. I also certify that this transfer is for the purpose of making a gift (or in response to a final judgement, court order, divorce decree, or property settlement agreement).
The sentences in red worried me a little, could this really trigger a tax event?! Or could that be considered by the system that me (the sub account) received a gift and it is all taxable?! I am only moving the money from my right pocket to my left pocket after all! I am over worried?
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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Mel Lindauer
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Re: Moving I bonds to "Custom" I bonds account

Post by Mel Lindauer » Fri Jan 05, 2018 4:11 pm

Sounds to me like they're considering it a redemption and reissue. Unless that's what you mean to do (it doesn't sound like it), I wouldn't do it.

FWIW, I see no reason to do it anyway.
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HueyLD
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Re: Moving I bonds to "Custom" I bonds account

Post by HueyLD » Fri Jan 05, 2018 4:15 pm

You can call the Treasury Retail Division at 1-844-284-2676 (toll free) and ask them.

BogleMelon
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Re: Moving I bonds to "Custom" I bonds account

Post by BogleMelon » Fri Jan 05, 2018 4:29 pm

Mel Lindauer wrote:
Fri Jan 05, 2018 4:11 pm
Sounds to me like they're considering it a redemption and reissue. Unless that's what you mean to do (it doesn't sound like it), I wouldn't do it.

FWIW, I see no reason to do it anyway.
I couldn't redeem even if I wanted to, because there is still few months left on the 1 year restriction period, so I took the chance with a small amount first. Nothing really happened, only a transfer transaction and it appears instantly into my new custom account.
But thanks anyways!
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

WolfgangPauli
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Re: Moving I bonds to "Custom" I bonds account

Post by WolfgangPauli » Fri Jan 05, 2018 4:32 pm

I am curious if you would share the purpose of doing this? Perhaps I am missing something but I cannot conceive of an idea for doing this...
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BogleMelon
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Re: Moving I bonds to "Custom" I bonds account

Post by BogleMelon » Fri Jan 05, 2018 4:41 pm

WolfgangPauli wrote:
Fri Jan 05, 2018 4:32 pm
I am curious if you would share the purpose of doing this? Perhaps I am missing something but I cannot conceive of an idea for doing this...
The same purpose Treasury Direct created this for: Multiple saving goals (Mental accounting kind of thing)
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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HueyLD
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Re: Moving I bonds to "Custom" I bonds account

Post by HueyLD » Fri Jan 05, 2018 5:22 pm

The instructions from the TD are:
Page Title: ManageDirect® > Establish a Custom Account

What you can do on this page:

A Custom account is an account you establish to meet specific financial goals and is linked to your Primary account. The account offers the same capabilities you enjoy in your Primary account.

Your Custom account uses some of the information already supplied in your Primary account. You can create a customized name, such as "Vacation Fund," for the account. Select "Use my Primary E-mail Address" to use the e-mail address already supplied in your Primary account. You may provide different information if you wish.

After establishing a Custom account, if you wish to add any of the bank accounts listed in your Primary account, click the "Contact Us" link and provide the information. If you wish to add a new bank account, go to ManageDirect and click the Update my Bank Information link.

By clicking "Submit" you agree to the following:

I understand that I am submitting an application for the establishment of a Custom account in TreasuryDirect.

I understand that the terms and conditions contained in 31 CFR part 363 apply to this account.

I understand that I have agreed to accept Form 1099-Substitute electronically instead of on paper for every year a statement is furnished for this account.

I certify that all information provided for this account establishment application, including the financial institution account information, is true, correct and complete.

Primary Actions:

Click "Submit" to go to Account Info.
Click "Cancel" to return to ManageDirect.
Did you follow all the instructions?

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