Has anyone converted paper I-Bonds to electronic?

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Browser
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Has anyone converted paper I-Bonds to electronic?

Post by Browser » Thu Dec 05, 2013 11:50 am

I need to convert some paper I-Bonds to electronic form on TD in order to facilitate redemption. I was wondering how this works. What happens to the paper bonds once they are converted? Do you have to send them back to Treasury?
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JW-Retired
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Re: Has anyone converted paper I-Bonds to electronic?

Post by JW-Retired » Thu Dec 05, 2013 12:06 pm

What happen to walking into a bank or credit union and redeeming bonds?
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letsgobobby
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Re: Has anyone converted paper I-Bonds to electronic?

Post by letsgobobby » Thu Dec 05, 2013 12:07 pm

What are the disadvantages of converting paper to electronic? It might obviate my need for a safety deposit box. This is on my to do list, just very far down.

Tony
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Tony » Thu Dec 05, 2013 12:08 pm

Yes, I did it a year ago.

It's a good idea to call TD and find out exactly what you need to do.

I've forgotten the entire procedure, but I do remember that we had to take the paper bonds to a bank in which we had an account to get a signature guarantee (not medallion, as I recall). We then sent them in, along with
a form which you can download from the Treasury Direct website. Make sure you get the correct mailing address for your section of the country.

It went smoothly and did not take long at all.

Note: Do NOT sign the savings bonds until you are in the presence of the certifying bank employee!

Hope this helps and sorry I can't remember all of the specifics.
Tony

linguini
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Re: Has anyone converted paper I-Bonds to electronic?

Post by linguini » Thu Dec 05, 2013 12:11 pm

I've done it. You have to type in the serial codes on treasury direct, print out a form, and mail them in. They get added to a linked td account where you can redeem them. It was pretty easy, but I would recommend taking a photo of your paper bonds before mailing them in in case they get lost.

Edit: I do not recall having to go to a bank to get anything certified.

sscritic
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Re: Has anyone converted paper I-Bonds to electronic?

Post by sscritic » Thu Dec 05, 2013 12:15 pm

I have never done it, but my first step would be to read the instructions at treasurydirect.com
How do I convert my paper savings bonds into electronic savings bonds?

Before you can convert your paper savings bonds, you must first create a Conversion Linked Account:

In your primary account, click the ManageDirect tab at the top of the page.
Under the heading Manage My Linked Accounts, click Establish a Conversion Linked Account.
The Establish a Conversion Account page will appear.
Click the Create Account button. You will be directed to your new Conversion Linked account and you can begin the conversion process from the ManageDirect page.
Note: In the future, you must access your Conversion Linked account through your Primary account.
The name for the Conversion account "My Converted Bonds", followed by its TreasuryDirect account number, appears in the top right corner of the Account Info page. The two arrows let you know that you're currently viewing the Conversion account. To go back to your primary account, click the link above the conversion account number.

Step 1 - Getting Started

Gather your Series EE and I Savings Bonds; please don't sign the back of your savings bonds.
Sort savings bonds by the name(s) on them:
One name alone,
two names with OR,
one name with POD (or beneficiary) to a second name,
any others.
Note: In an entity account, all securities will carry a registration identical to your Entity Account name.
Log in to your TreasuryDirect account at a computer with access to a printer.
Access your conversion linked account (My Converted Bonds).
Click on the ManageDirect tab.

Step 2 - Adding Registrations to Your Conversion Linked Account (individual accounts only – does not apply to entity accounts)

Minors

If you wish to convert bonds on which your minor child is named as a co-owner with you--the Primary Account owner--and you wish to deliver the bonds to a Minor Linked Account in the name of the minor, provide this information in the Comments field when you enter the Security Information on the Add a Bond page. Once the bonds are converted, they will appear in your child's Minor Linked Account.

If you do not provide the instructions before the bonds are converted, transferring the bonds from your account to an account with a different taxpayer identification account number--such as your child's Minor Linked account--is reported to the IRS for the tax year in which the transfer occurs. The Minor Linked Account must be established before converted bonds may be delivered to the account. If you wish to create an account for your minor child, select Establish a Minor Linked Account under Manage My Linked Accounts on the ManageDirect page in your Primary Account.

Deceased registrant

If anyone listed on the bonds is deceased, omit their name from the registration. You will need to submit a certified copy of the death certificate. (Other evidence might be required also.) The bonds will be converted in the surviving registrant's name alone.

Procedure to add registrations

Under Manage My Conversions, click on "Create my registration list." For each different registration, enter the Taxpayer Identification Number (TIN) and name of each registrant. If a registrant's TIN is not known, enter zeros: 000-00-0000.
Note: For your convenience, a registration with your name and TIN is already in the registration list as a Single Owner registration type.
For a registration Type:
Select "Single Owner" if one person is named.
Select the connector that appears: "OR" or "Payable on Death" (may be shown as POD or Beneficiary) for two names.
Select "OTHER" if a different connector appears, such as AND or WITH. Note: If the bond is not registered in an authorized form, we will change the registration to the closest authorized form. In other circumstances, we may contact you after we receive the bonds and provide appropriate instructions to complete the transaction.
Click "Submit & Add Another" to add more registrations until you have entered all the different registrations you have. When you have entered your last different registration, click "Submit."

Step 3 - Adding the Bonds to Your Conversion Linked Account

Click the ManageDirect tab to go back to Manage My Conversions and click "Convert my bonds."
Select the registration for the bond you are adding to the Conversion Cart, and click "Select Registration & Continue."
On Add a Bond page:
Select the Series and Denomination that appear on the bond. If you need to choose another registration, click "Select a Different Registration."
Enter the Serial Number and Issue Date (month and year).
Enter any additional information in the Comments field, such as
Your name has been changed, or
You wish to convert bonds on which your minor child is named as a co-owner with you, and you wish to deliver the bonds to the Minor Linked Account in the name of the minor.
Click "Add to Cart." Your cart is automatically saved every time you add a bond. If you can't finish, click "Save Cart," and log off. When you would like to return to add more bonds, go to ManageDirect and click either "Convert my bonds" or "View my cart."
Note: Your cart will notify you if you are submitting a bond that is fully matured. When you convert a bond that has reached final maturity, TreasuryDirect will automatically redeem it and purchase a Zero-Percent Certificate of Indebtedness (C of I) in your Primary account. The interest earned is reported to the IRS for the tax year of the redemption. If you need to remove a bond from the cart, select the checkbox under the Remove column and click "Remove Checked Items." To correct information on a bond that's in your cart, you must remove it and re-enter.

You can only add bonds to one cart at a time and each cart is limited to 50 bonds at a time. After you click Create a Manifest, the cart is emptied and you can add more bonds, if necessary. A new manifest is created with each cart of bonds you submit. Since each manifest is individually numbered, you can create as many manifests as you need in order to exchange all your paper bonds. Important! Once you click "Create a Manifest," you cannot return to that cart to add more bonds.

Step 4 - Creating a Manifest From Your Cart to Mail With Your Bonds

On the Conversion Cart page, click "Create a Manifest" to continue with the conversion request. A numbered manifest lists the bonds that you put in the cart. (If you have saved a cart in a previous session, you access your cart from the View My Cart option in ManageDirect.)
Print and sign the manifest. Keep a copy of the manifest.
Mail the manifest with your bonds to the address shown on the form. Please don't sign the back of your savings bonds.


After You Submit Your Bonds

Conversion of your paper savings bonds to electronic securities should be completed approximately three weeks from the date we receive the bonds. You will not receive a notification when we receive the bonds or when the conversion process is complete. However, you may check the status of your bonds at any time, through your TreasuryDirect Conversion linked account. Click ManageDirect, then "View my manifests." Select the manifest you wish to view and click the "Select" button. You will see one of the following notations in the Status column next to the bonds on your manifest:

In Progress- processing in progress;
Pending - Customer Service needs additional information;
Returned - Bond returned to you as ineligible for conversion;
Not received - Treasury did not receive the bond listed on the manifest;
Canceled - Bond closed in previous transaction. For example, a replacement bond was issued after being reported lost, stolen, or destroyed; or
Converted - Bond converted. Check your Current Holdings or Gift Box in My Converted Bonds Linked Account, or your Minor Linked Account.

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Ice-9
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Ice-9 » Thu Dec 05, 2013 12:24 pm

If and when you convert your savings bonds, be aware that your Treasury Direct login will now have two separate accounts in it - One for online purchases and one for converted bonds.

This is very relevant come tax time. If you redeemed any converted bonds within the tax year, you'll need to be aware that the default 1099 you look at after logging in to Treasury Direct is for the online purchases account only; you must click the link at the bottom of the initial screen to view the converted bonds account and access the 1099 for those bonds. (I learned this lesson the hard way and received a note from the IRS a couple of years later that I hadn't reported interest on my redeemed converted bonds.)

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Browser
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Browser » Thu Dec 05, 2013 1:04 pm

The paper I-bonds are registered to my elderly mother. Does anyone know if these can be redeemed at a bank by myself with power-of-attorney, or does the owner have to be present? This would be rather difficult. Also, I think I heard somewhere on the forum that it's difficult to redeem these at any old bank these days - you might have to go to a particular bank that still handles this.
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Re: Has anyone converted paper I-Bonds to electronic?

Post by JW-Retired » Thu Dec 05, 2013 1:17 pm

Browser wrote:The paper I-bonds are registered to my elderly mother. Does anyone know if these can be redeemed at a bank by myself with power-of-attorney, or does the owner have to be present? This would be rather difficult. Also, I think I heard somewhere on the forum that it's difficult to redeem these at any old bank these days - you might have to go to a particular bank that still handles this.
Does she have a bank account? The first thing I would try is to walk into a branch of her bank and put the bond redemption money into her account. That's what powers of attorney are for.
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placeholder
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Re: Has anyone converted paper I-Bonds to electronic?

Post by placeholder » Thu Dec 05, 2013 1:30 pm

Call the bank first. I cashed EE bonds at US Bank last year.

seymore92
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Re: Has anyone converted paper I-Bonds to electronic?

Post by seymore92 » Thu Sep 19, 2019 10:58 am

[duplicate]
Last edited by seymore92 on Thu Sep 19, 2019 11:04 am, edited 2 times in total.

seymore92
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Re: Has anyone converted paper I-Bonds to electronic?

Post by seymore92 » Thu Sep 19, 2019 11:04 am

Does anyone know if you can move/consolidate the converted paper-to-electronic I-Bonds from the My Converted Bonds account to the main online account at TreasuryDirect?

Also I mailed paper bonds on 9/3 and they finished converting by 9/19 (~2 weeks), for setting future expectations of turnaround time.

dcabler
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Re: Has anyone converted paper I-Bonds to electronic?

Post by dcabler » Thu Sep 19, 2019 11:21 am

Browser wrote:
Thu Dec 05, 2013 11:50 am
I need to convert some paper I-Bonds to electronic form on TD in order to facilitate redemption. I was wondering how this works. What happens to the paper bonds once they are converted? Do you have to send them back to Treasury?
I do it every year. You can purchase up to $5K in Ibonds from your tax refund each year, but for whatever reason, they only use paper bonds for that and they choose the denominations. Anyway, the instructions are on the TD website. They show you how to register the electronic conversion as you enter each physical bond you have. Then you mail them into the address they give. It will show up in your account in "my converted bonds". I've done this 3 years in a row. A little tedious, but nothing more than that.

Ranunculus
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Ranunculus » Thu Sep 19, 2019 11:22 am

I did this years ago, following the instructions on the web site. No visit to the bank was needed. There is a several week waiting period where it felt like the money was in limbo, it was a huge relief when the linked account was finally funded. I recall asking whether I could merge the linked account with an existing account and the answer was "no", but things may have changed since then. Almost any brick and mortar bank can redeem bonds but for some reason neither Schwab nor Fidelity are able to process them, even if you bring them to an office location.

I have contacted Treasury Direct numerous times with a variety of questions and the email response is fairly rapid and helpful. I am concerned about access to the bonds should something happen to me before they are redeemed. TD sends no statements, either by email or regular mail, so it is important that family members are aware of the accounts and the procedure to redeem online bonds. Every year I print out the account details with a listing of all bonds, so at least that information will be in my files. Fortunately the log in procedure is not as onerous as in the past, when a paper decoder card was needed to sign in to the account.

It's tempting to liquidate the bonds to simplify our estate, but 4% return on some of the bonds is looking pretty good now.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by dcabler » Thu Sep 19, 2019 11:23 am

Ice-9 wrote:
Thu Dec 05, 2013 12:24 pm
If and when you convert your savings bonds, be aware that your Treasury Direct login will now have two separate accounts in it - One for online purchases and one for converted bonds.

This is very relevant come tax time. If you redeemed any converted bonds within the tax year, you'll need to be aware that the default 1099 you look at after logging in to Treasury Direct is for the online purchases account only; you must click the link at the bottom of the initial screen to view the converted bonds account and access the 1099 for those bonds. (I learned this lesson the hard way and received a note from the IRS a couple of years later that I hadn't reported interest on my redeemed converted bonds.)
There is a way to move the converted bonds into the same account as your online purchases. Somebody pointed this out to me here on this forum sometime in the last year or so. Works like a charm. Now, if I can only find the instructions again. :shock:

seymore92
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Re: Has anyone converted paper I-Bonds to electronic?

Post by seymore92 » Thu Sep 19, 2019 11:30 am

dcabler wrote:
Thu Sep 19, 2019 11:23 am
Ice-9 wrote:
Thu Dec 05, 2013 12:24 pm
If and when you convert your savings bonds, be aware that your Treasury Direct login will now have two separate accounts in it - One for online purchases and one for converted bonds.

This is very relevant come tax time. If you redeemed any converted bonds within the tax year, you'll need to be aware that the default 1099 you look at after logging in to Treasury Direct is for the online purchases account only; you must click the link at the bottom of the initial screen to view the converted bonds account and access the 1099 for those bonds. (I learned this lesson the hard way and received a note from the IRS a couple of years later that I hadn't reported interest on my redeemed converted bonds.)
There is a way to move the converted bonds into the same account as your online purchases. Somebody pointed this out to me here on this forum sometime in the last year or so. Works like a charm. Now, if I can only find the instructions again. :shock:
I just found and tried this and it worked.
Go to My Converted Bonds linked account -> ManageDirect tab -> Transfer Securities -> Savings Bonds Series I radio button -> Submit -> Check the securities you want to transfer to primary -> Select -> enter your SSN & your Primary Account # in the Transfer Instructions boxes. Submit and Submit on the Confirmation page.
There is this note on the confirmation page:
"By clicking the SUBMIT button below: I understand these securities 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 transfer happened to my primary account instantaneously. I'm assuming there is no actually tax liability for me to transfer from the Converted Account to the Primary account under my same SSN. YMMV.

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HueyLD
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Re: Has anyone converted paper I-Bonds to electronic?

Post by HueyLD » Thu Sep 19, 2019 11:40 am

“There is this note on the confirmation page:

"By clicking the SUBMIT button below: I understand these securities 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 transfer happened to my primary account instantaneously. I'm assuming there is no actually tax liability for me to transfer from the Converted Account to the Primary account under my same SSN. YMMV.”

There is no tax liability because you merely moved money from your left pocket to your right pocket.

However, if you transfer from your account to another person’s account, there will be tax liability.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by Khuzud » Thu Sep 19, 2019 12:55 pm

HueyLD wrote:
Thu Sep 19, 2019 11:40 am
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).
I would like to consolidate my electronic purchase and conversion accounts at TD, but it wouldn’t be for any of these purposes. It would only be for ease and convenience. Why do they have this restriction?

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Re: Has anyone converted paper I-Bonds to electronic?

Post by HueyLD » Thu Sep 19, 2019 1:05 pm

I did not write that. The TD did.

If all you want to do is to merge the conversion account into your primary TD account, you essentially make a gift to yourself. No problems whatsoever.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by dcabler » Thu Sep 19, 2019 2:59 pm

seymore92 wrote:
Thu Sep 19, 2019 11:30 am
dcabler wrote:
Thu Sep 19, 2019 11:23 am
Ice-9 wrote:
Thu Dec 05, 2013 12:24 pm
If and when you convert your savings bonds, be aware that your Treasury Direct login will now have two separate accounts in it - One for online purchases and one for converted bonds.

This is very relevant come tax time. If you redeemed any converted bonds within the tax year, you'll need to be aware that the default 1099 you look at after logging in to Treasury Direct is for the online purchases account only; you must click the link at the bottom of the initial screen to view the converted bonds account and access the 1099 for those bonds. (I learned this lesson the hard way and received a note from the IRS a couple of years later that I hadn't reported interest on my redeemed converted bonds.)
There is a way to move the converted bonds into the same account as your online purchases. Somebody pointed this out to me here on this forum sometime in the last year or so. Works like a charm. Now, if I can only find the instructions again. :shock:
I just found and tried this and it worked.
Go to My Converted Bonds linked account -> ManageDirect tab -> Transfer Securities -> Savings Bonds Series I radio button -> Submit -> Check the securities you want to transfer to primary -> Select -> enter your SSN & your Primary Account # in the Transfer Instructions boxes. Submit and Submit on the Confirmation page.
There is this note on the confirmation page:
"By clicking the SUBMIT button below: I understand these securities 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 transfer happened to my primary account instantaneously. I'm assuming there is no actually tax liability for me to transfer from the Converted Account to the Primary account under my same SSN. YMMV.
Cool!

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Re: Has anyone converted paper I-Bonds to electronic?

Post by nisiprius » Thu Sep 19, 2019 3:09 pm

letsgobobby wrote:
Thu Dec 05, 2013 12:07 pm
...What are the disadvantages of converting paper to electronic?...
I know of two.

1) There is no true "co-ownership" of electronic bonds. [added: apparently not true when a co-owned paper bond is converted to electronic form, see next two postings below.] Our paper series I savings bonds are co-owned by me and my spouse. On a "co-owned" paper bond, the co-owners either of them can redeem the bond, even without the other's knowledge or consent. Consequently, it is my belief that a surviving co-owner does not need to go through any formalities at all to redeem a bond.

With electronic bonds, the situation is murky. You can create a "WITH" ownership on an electronic bond, but it is not the same as co-ownership on paper bonds. There is a primary and a secondary owner. The bond is "in" the primary owner's account and is not in the secondary owner's account. So how does a secondary owner redeem such a bond? The right way is for the primary owner to go through a procedure on the website to grant transact rights on them; then the secondary owner can log into their own account and redeem them. (The wrong way is for the secondary owner to know the primary owner's password, impersonate the primary owner, and log into the primary owner's account.) If the primary owner is deceased, the secondary owner is supposed to file forms and a copy of the death certificate and get the bonds transferred into their own account. It is not clear whether a survivor can shortcut this by doing some seemingly harmless rulebreaking.

2) The Treasury Direct website is clunky. The procedure a secondary owner must follow for redeeming a bond that they have transact rights on has enough steps that you need to write them down. It is the kind of site where you forget how to use it unless you actually log in and use it once a year or so. For whatever reason, despite telling it to "remember my computer," more often than not it will not let me log in directly, but insists on emailing me a one-time password that I must receive and use to regain access. Several times (in ten or so years) I've been locked out for reasons I didn't understand, and had to contact Treasury Direct support (which answered the phone quickly and unlocked the account quickly). None of this is a big problem for me, but I wouldn't want a surviving spouse to need to cope with it.

Of course, the other side of the coin is that redeeming paper bonds is already problematical and probably will get worse.
Last edited by nisiprius on Thu Sep 19, 2019 8:56 pm, edited 2 times in total.
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Re: Has anyone converted paper I-Bonds to electronic?

Post by need403bhelp » Thu Sep 19, 2019 8:26 pm

HueyLD wrote:
Thu Sep 19, 2019 1:05 pm
I did not write that. The TD did.

If all you want to do is to merge the conversion account into your primary TD account, you essentially make a gift to yourself. No problems whatsoever.
It looks my conversion account lists my I bonds that were converted as "A OR B."

My primary TD account lists my I bonds that I purchased electronically as "A WITH B."

If I move my conversion account I bonds to my primary account, will they retain the "OR" registration? Also, what is the difference between the "OR" registration for converted bonds and the "WITH" registration for primary electronic bonds?

Thank you!

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Re: Has anyone converted paper I-Bonds to electronic?

Post by nisiprius » Thu Sep 19, 2019 8:55 pm

need403bhelp wrote:
Thu Sep 19, 2019 8:26 pm
...It looks my conversion account lists my I bonds that were converted as "A OR B."

My primary TD account lists my I bonds that I purchased electronically as "A WITH B."

If I move my conversion account I bonds to my primary account, will they retain the "OR" registration? Also, what is the difference between the "OR" registration for converted bonds and the "WITH" registration for primary electronic bonds?
That is very interesting... and very confusing.

"OR" is the word that is used in the printed description on the face of the bonds that have me and my spouse as co-owners. So apparently "OR" means co-ownership.

So it appears that I was wrong when I said that there was no co-ownership of electronic bonds. You cannot designate co-owners when you buy a new electronic bond on the TreasuryDirect website. But apparently when you convert a co-owned paper bond, it becomes a co-owned electronic bond. Since I don't have any of these, and since I don't think the TreasuryDirect website talks about them, it is hard to know exactly how they do work.
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HueyLD
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Re: Has anyone converted paper I-Bonds to electronic?

Post by HueyLD » Fri Sep 20, 2019 12:07 am

need403bhelp wrote:
Thu Sep 19, 2019 8:26 pm
It looks my conversion account lists my I bonds that were converted as "A OR B."

My primary TD account lists my I bonds that I purchased electronically as "A WITH B."

If I move my conversion account I bonds to my primary account, will they retain the "OR" registration? Also, what is the difference between the "OR" registration for converted bonds and the "WITH" registration for primary electronic bonds?
The conversion linked account shows the same ownership structure as paper bonds for audit trail only.

However, the conversion linked account only belongs to the first named owner (aka the primary owner) and only the primary owner can access, transfer, sell, etc. bonds in the associated conversion linked account.

As a result, the conversion linked account belongs to the first named owner only. You can choose to leave the linked account as is or transfer the linked account to your primary account. The ownership in TD is now changed to the primary owner WITH secondary owner either way.

The fact that the former co-owner is now the secondary owner without rights he used to have is a very good reason why one may not want to convert paper bonds. I think the Treasury has destroyed the flexibility of savings bonds by forcing the “primary with secondary” on savings bond holders.

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Harry Livermore
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Harry Livermore » Fri Sep 20, 2019 6:24 am

I only have paper I-bonds, and in fact stopped buying them just before they stopped issuing them (I started putting larger sums into VG's bond funds) so my small pile is not worth very much (just < $10K)
Nothing actionable an not offering useful advice here. Just opining. I wish that US bonds of all stripes were paper, easily redeemable for cash at any bank, and "pay to the order of" on the back (so if, for example, I had a $100 bond and wished to gift it to someone, I could just endorse and presto!)
Just my own little wish for a world where some things remain a little more "cash like"...
Cheers,
Harry

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HueyLD
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Re: Has anyone converted paper I-Bonds to electronic?

Post by HueyLD » Fri Sep 20, 2019 8:06 am

Harry,

Paper bonds may be very difficult to redeem at local banks as I found out the hard way myself. As more and more banks choose to either not redeem them or put up ridiculously low redemption limits to make it impossible redeem, it is only going to get more difficult in the future.

Of course some locations will have better options than others.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by need403bhelp » Fri Sep 20, 2019 6:33 pm

HueyLD wrote:
Fri Sep 20, 2019 12:07 am
need403bhelp wrote:
Thu Sep 19, 2019 8:26 pm
It looks my conversion account lists my I bonds that were converted as "A OR B."

My primary TD account lists my I bonds that I purchased electronically as "A WITH B."

If I move my conversion account I bonds to my primary account, will they retain the "OR" registration? Also, what is the difference between the "OR" registration for converted bonds and the "WITH" registration for primary electronic bonds?
The conversion linked account shows the same ownership structure as paper bonds for audit trail only.

However, the conversion linked account only belongs to the first named owner (aka the primary owner) and only the primary owner can access, transfer, sell, etc. bonds in the associated conversion linked account.

As a result, the conversion linked account belongs to the first named owner only. You can choose to leave the linked account as is or transfer the linked account to your primary account. The ownership in TD is now changed to the primary owner WITH secondary owner either way.

The fact that the former co-owner is now the secondary owner without rights he used to have is a very good reason why one may not want to convert paper bonds. I think the Treasury has destroyed the flexibility of savings bonds by forcing the “primary with secondary” on savings bond holders.
I see. So my co-owner has transact rights on the conversion I bonds. Is this different from the rights they had when they owned the paper bonds?

Also, does anyone know whether the "A OR B" registration is preserved when you follow the steps in this thread to move the I bonds to your primary TD account?

Thank you!

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HueyLD
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Re: Has anyone converted paper I-Bonds to electronic?

Post by HueyLD » Fri Sep 20, 2019 7:35 pm

In TD, the second named owner is NOT a co-owner. Rather, (s)he is a secondary owner and has no rights unless the primary owner specifically grants transaction rights to the secondary owner. And keep in mind that having transaction rights is not the same as being a co-owner because the secondary has no ownership right. And the transaction rights stop upon the demise of the primary owner, just like a POA.

As I said in a prior post, the A or B designation in converted bonds is for audit trail only. B has no ownership right in TD. You should just merge the converted bonds into the primary account so that you have one fewer account to deal with.

The TD is doing everything possible to make their savings bond program unattractive. Knowing what I know now, I wish I never converted any of my paper bonds.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by S&L1940 » Fri Sep 20, 2019 7:52 pm

We have no problem managing paper I Bonds at Bank of America
I think they limit a transaction to ten or less bonds
Same as cashing or depositing a check, quick and easy
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Re: Has anyone converted paper I-Bonds to electronic?

Post by nisiprius » Fri Sep 20, 2019 8:05 pm

need403bhelp wrote:
Fri Sep 20, 2019 6:33 pm
...I see. So my co-owner has transact rights on the conversion I bonds. Is this different from the rights they had when they owned the paper bonds?...
I think so. What HueyLD says above sounds right. The only point I'll make is that they definitely can't be identical, because one difference is that the primary owner of an electronic bond can revoke those transact rights whenever they want.

With regard to redeeming paper bonds, I have existing accounts at two local brick-and-mortar banks within walking distance. One of them does not redeem savings bonds. The other says yes, they do, no problem, unlimited for people with accounts, $1,000 limit without an account. So noodging my spouse to open an account at that bank is on my to-do list.
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Jack FFR1846 » Fri Sep 20, 2019 10:03 pm

HueyLD wrote:
Fri Sep 20, 2019 8:06 am
Harry,

Paper bonds may be very difficult to redeem at local banks as I found out the hard way myself. As more and more banks choose to either not redeem them or put up ridiculously low redemption limits to make it impossible redeem, it is only going to get more difficult in the future.

Of course some locations will have better options than others.
Change your bank.

Let's say that tomorrow at 10am, I need $50k in cash. What do I do? I go to my credit union (DCU) with $50k of paper bonds. I sign them in front of the teller. They deposit the amount in my account which is immediately available. If they have the cash right there, I can take it out right then. I have redeemed $50k in bonds and it took me 15 minutes.

How long before you have cash from electronic bonds? Say you start at 10am tomorrow....Saturday.
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Harry Livermore
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Re: Has anyone converted paper I-Bonds to electronic?

Post by Harry Livermore » Sat Sep 21, 2019 6:57 am

HueyLD wrote:
Fri Sep 20, 2019 8:06 am
Harry,

Paper bonds may be very difficult to redeem at local banks as I found out the hard way myself. As more and more banks choose to either not redeem them or put up ridiculously low redemption limits to make it impossible redeem, it is only going to get more difficult in the future.

Of course some locations will have better options than others.
I know that. I was simply >wishing< for a world where not everything was a complex transaction, or one where every movement was tracked, vetted, taxed, and penalized.
Cheers

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Re: Has anyone converted paper I-Bonds to electronic?

Post by nisiprius » Sat Sep 21, 2019 8:59 am

Jack FFR1846 wrote:
Fri Sep 20, 2019 10:03 pm
HueyLD wrote:
Fri Sep 20, 2019 8:06 am
Harry, Paper bonds may be very difficult to redeem at local banks as I found out the hard way myself.... Of course some locations will have better options than others.
Change your bank. [...at my credit union, DCU, it's quick and easy...]
The problem is, nobody seems to understand just what is going on with savings bonds. The turmoil began in late 2007 with a sudden, unexplained reduction in the annual purchase limit from $30,000 to $5,000, made with no real explanation and with only thirty days' notice. (It's now been increased, but nowhere near what it was). Then came the discontinuance of paper bonds (except! that they are an option for receiving income tax refunds, so they need to keep issuing them and printing them anyway).

What goes on behind the scenes when a bank decides whether or not to handle savings bonds? When HueyLD says "as more and more banks choose to either not redeem them or put up ridiculously low redemption limits..." is that bleak pessimism or plain common sense? Is there a trend?

Yes, I think that the small, community-minded "good guys" are apt to be the ones that still handle savings bonds, while the profit-maximizing giants are likely not to--and to imply that "nobody does that any more."

There has to be something in it for the banks, and I think the banks must get some kind of payment from the Treasury for serving as their agent. If so, the question is whether these payments are adequate, so that it's reasonable to assume that a bank that does it will likely continue to do it? Or are they inadequate, and the "good guys" handle savings bonds at a loss as a public service? If so, then this service is likely hanging by a thread.

Since savings bonds are not held by your local credit union or bank, they don't know who would be affected if they discontinued redemptions. They can't send out targeted notices even if they wanted to. They sure aren't going to advertise it ("New! Improved! No more savings bond redemptions!") If a bank discontinues savings bonds redemptions, likely the way most people will find out about it is to get taken by surprise, when they walk in to redeem a bond and get rejected.

For purposes of a surviving spouse, it's important to know if savings bond redemption services are likely to be stable at the places that provide it, or whether they are hanging by a thread. I don't know, and I don't know how to find out.
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Re: Has anyone converted paper I-Bonds to electronic?

Post by TBillT » Sat Sep 21, 2019 9:16 am

Browser wrote:
Thu Dec 05, 2013 1:04 pm
The paper I-bonds are registered to my elderly mother. Does anyone know if these can be redeemed at a bank by myself with power-of-attorney, or does the owner have to be present? This would be rather difficult. Also, I think I heard somewhere on the forum that it's difficult to redeem these at any old bank these days - you might have to go to a particular bank that still handles this.
I am in the same position with my elderly mother, she does banking herself but was sick recently.
I am the PoA at PNC but this does not give me total power over her account....I can sign checks. I could not reset account PW.
I wonder if PNC have another status of authorized person.
Not sure about cashing saving bonds. Had no prob cashing my own at BoA this year, as deposit to our account.

I plan to sell off her elec ibonds just to keep life simpler. The paper ibonds maybe sell maybe not. One has me as beneficiary which is probably a mistake, but since I am the executor I figure I can use that for operating funds until I gain access to the account, when the time comes.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by 2pedals » Sat Sep 21, 2019 10:54 am

I did this last year but don't remember all the details but this is what a remember.

I collected all of my paper bonds
Created a new Establish a Conversion Linked Account
Created a manifest of my paper bonds to be converted on the TD web page (issue, serial numbers, dates and bond types)
Signed the manifest
Sent the paper bonds to the treasury with the manifest

I had to create more than one manifest and mailing because I was limited to how many bonds can be listed in a manifest.

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Re: Has anyone converted paper I-Bonds to electronic?

Post by chemocean » Sat Sep 21, 2019 4:21 pm

Note that converting I-bonds by the primary owner with a manifest only requires a signature. Transferring or redeeming paper bonds I bonds upon the dead of the primary owner requires a guaranteed signature. Transferring I bonds of a deceased primary bond holder by the secondary owner or beneficiary only requires a secured email within the secondary owner's or beneficiary's Treasury Direct On-line account.

To answer a question above, the titling on the paper bonds is transferred to electronic bonds. I understand that changes to titling of paper bonds is no long possible. To add my mother to my father's I-Bonds (father primary sole owner), he had to convert the bonds to electronic bonds and then change the registration within his online TD account.

need403bhelp
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Re: Has anyone converted paper I-Bonds to electronic?

Post by need403bhelp » Sat Sep 21, 2019 6:16 pm

chemocean wrote:
Sat Sep 21, 2019 4:21 pm
Note that converting I-bonds by the primary owner with a manifest only requires a signature. Transferring or redeeming paper bonds I bonds upon the dead of the primary owner requires a guaranteed signature. Transferring I bonds of a deceased primary bond holder by the secondary owner or beneficiary only requires a secured email within the secondary owner's or beneficiary's Treasury Direct On-line account.

To answer a question above, the titling on the paper bonds is transferred to electronic bonds. I understand that changes to titling of paper bonds is no long possible. To add my mother to my father's I-Bonds (father primary sole owner), he had to convert the bonds to electronic bonds and then change the registration within his online TD account.
Thanks so much for the helpful clarification.

Re the titling - if I were to transfer the I bonds from my conversion linked account to my main TD account, would this change the titling?

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