Redeeming Paper EE Bonds

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Tom_T
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Redeeming Paper EE Bonds

Post by Tom_T »

[Split into new topic by Moderator Misenplace at OP's request]
Question about redeeming a paper Series EE bond...

My two kids were given a $100 paper EE bonds each 15 & 18 years ago, respectively. The bonds have nearly reached $100 market value, and we want to cash them. (I know about form 1522.) Each bond is made out to the child's name, but underneath his/her name/address, it says "OR (parent's name)." I assume that means the parent can cash the bond? The form requires you to enter the name of the bondholder. Does that have to be the child, or can it list the named parent?
invest4
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Re: Redeeming Paper EE Bonds

Post by invest4 »

I believe the 18 year old will need to cash their own bond if it is in their name and you are otherwise not showing as a designee on the bond.

For the younger:

https://treasurydirect.gov/savings-bond ... ung-child/

In worst case, the bank should know what is needed to cash the bond and you can do it right there over the counter.

Best wishes.
bradinsky
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Re: Redeeming Paper EE Bonds

Post by bradinsky »

I redeemed about 15 EE bonds at our local bank branch. Fairly quick & painless. Based on how plodding slow the federal government moves today, that’s the only way to go.
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Kevin M
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Re: Redeeming Paper EE Bonds

Post by Kevin M »

invest4 wrote: Sun Feb 11, 2024 2:28 pm I believe the 18 year old will need to cash their own bond if it is in their name and you are otherwise not showing as a designee on the bond.
But they the parent is named on the bond, which is titled child or parent:
Tom_T wrote: Sun Feb 11, 2024 8:54 am [Split into new topic by Moderator Misenplace at OP's request]
Each bond is made out to the child's name, but underneath his/her name/address, it says "OR (parent's name)."
So parent should be able to cash it, but since the 18 year old is a legal adult, I don't know why they wouldn't just cash it themselves.
If I make a calculation error, #Cruncher probably will let me know.
HomeStretch
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Re: Redeeming Paper EE Bonds

Post by HomeStretch »

I don’t know if this matters to you. But if a parent cashes a savings bond, the interest income may be reported as the parent's for tax purposes.
Driver540
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Re: Redeeming Paper EE Bonds

Post by Driver540 »

bradinsky wrote: Sun Feb 11, 2024 2:31 pm I redeemed about 15 EE bonds at our local bank branch. Fairly quick & painless. Based on how plodding slow the federal government moves today, that’s the only way to go.
I recently (less than two months ago) converted 223 Series EE bonds from paper to electronic via TreasuryDirect. A subset of those had already matured. Total time from mailing the bonds via USPS Certified to the money being available in my TD account was less than 3 weeks. Others may have had or will have a different experience, but that was mine.
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Re: Redeeming Paper EE Bonds

Post by Jack FFR1846 »

I have cashed a number of bonds in my name and also my son's name. They do say him OR me. I put my SS number on it, signed it in front of the Digital Credit Union person and handed them over. I've done this with one at a time, stack of 10 and combined EE and i in a stack of $50k worth. All have someone OR me on them or they say me OR someone. After I handed the bond over and the person typed it in, the money was in my account with no hold. So I guess 10 minutes to drive there, 15 minutes to do all that signing and 0 minutes for the money to be available to me.

You may wonder why I've cashed so many of these. Back in the day, when you could buy bonds online with a credit card for no extra fee, and buy $30k per person with a 6 month period before you could sell, I'd buy using my American Airlines card to get the points. I bought $30k for each family member with either DW or me as the OR person. Through the year, I'd cash them because I couldn't afford $120k worth of bonds a year. I was looking for the points so we could take our coach tickets to Aruba and upgrade them to first/business class. So for several years, I would cash at least $100k worth of these things in.
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gavinsiu
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Re: Redeeming Paper EE Bonds

Post by gavinsiu »

Try your local bank. Not every bank or credit union will do it, but Wells Fargo did and will even send a consolidated 1099-Int for the tax year.
bradinsky
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Re: Redeeming Paper EE Bonds

Post by bradinsky »

Driver540 wrote: Sun Feb 11, 2024 4:51 pm
bradinsky wrote: Sun Feb 11, 2024 2:31 pm I redeemed about 15 EE bonds at our local bank branch. Fairly quick & painless. Based on how plodding slow the federal government moves today, that’s the only way to go.
I recently (less than two months ago) converted 223 Series EE bonds from paper to electronic via TreasuryDirect. A subset of those had already matured. Total time from mailing the bonds via USPS Certified to the money being available in my TD account was less than 3 weeks. Others may have had or will have a different experience, but that was mine.
That’s great!
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Mel Lindauer
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Re: Redeeming Paper EE Bonds

Post by Mel Lindauer »

Tom_T wrote: Sun Feb 11, 2024 8:54 am [Split into new topic by Moderator Misenplace at OP's request]
Question about redeeming a paper Series EE bond...

My two kids were given a $100 paper EE bonds each 15 & 18 years ago, respectively. The bonds have nearly reached $100 market value, and we want to cash them. (I know about form 1522.) Each bond is made out to the child's name, but underneath his/her name/address, it says "OR (parent's name)." I assume that means the parent can cash the bond? The form requires you to enter the name of the bondholder. Does that have to be the child, or can it list the named parent?
In this and similar situations, EITHER named party can redeem the savings bonds without the knowledge or permission of the other named party. The redeeming party must supply their SS# and they'll get the 1099 and be responsible for the taxes.
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chemocean
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Re: Redeeming Paper EE Bonds

Post by chemocean »

HomeStretch wrote: Sun Feb 11, 2024 2:39 pm I don’t know if this matters to you. But if a parent cashes a savings bond, the interest income may be reported as the parent's for tax purposes.
I cashed my daughters bond on which I was secondary owner (the “or”). The accrued interest was assigned to my SSN.
tibbitts
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Re: Redeeming Paper EE Bonds

Post by tibbitts »

Don't convert the bond to electronic, since the OR would get lost in the translation. When my bank wouldn't redeem them (recent policy change), TD redeemed my EE-bonds by USmail in about 6 weeks two months ago; you have to supply a notarized form with your name (as the OR owner) and your social security number.
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Tom_T
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Re: Redeeming Paper EE Bonds

Post by Tom_T »

chemocean wrote: Sun Feb 11, 2024 11:41 pm
HomeStretch wrote: Sun Feb 11, 2024 2:39 pm I don’t know if this matters to you. But if a parent cashes a savings bond, the interest income may be reported as the parent's for tax purposes.
I cashed my daughters bond on which I was secondary owner (the “or”). The accrued interest was assigned to my SSN.
Thanks (and to Mel as well.) This is what I needed to know.

If there were a greater quantity of bonds, I might advise my kids to keep them, but one $100 bond each is not worth the time. They'd rather have the $95 or whatever it is. :)
chemocean
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Re: Redeeming Paper EE Bonds

Post by chemocean »

tibbitts wrote: Mon Feb 12, 2024 12:12 am Don't convert the bond to electronic, since the OR would get lost in the translation. When my bank wouldn't redeem them (recent policy change), TD redeemed my EE-bonds by USmail in about 6 weeks two months ago; you have to supply a notarized form with your name (as the OR owner) and your social security number.
The “or” will not be lost in conversion. The converted bonds will be titled in the first name listed with the second name as secondary. However, the bonds will be “restricted”, which means that the secondary owner must agree to any changes in titling.
tibbitts
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Re: Redeeming Paper EE Bonds

Post by tibbitts »

chemocean wrote: Mon Feb 12, 2024 9:29 am
tibbitts wrote: Mon Feb 12, 2024 12:12 am Don't convert the bond to electronic, since the OR would get lost in the translation. When my bank wouldn't redeem them (recent policy change), TD redeemed my EE-bonds by USmail in about 6 weeks two months ago; you have to supply a notarized form with your name (as the OR owner) and your social security number.
The “or” will not be lost in conversion. The converted bonds will be titled in the first name listed with the second name as secondary. However, the bonds will be “restricted”, which means that the secondary owner must agree to any changes in titling.
That's exactly what I meant by the OR being "lost" during conversion to electronic: you (the secondary owner) will lose your original redemption capability.
chemocean
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Re: Redeeming Paper EE Bonds

Post by chemocean »

tibbitts wrote: Mon Feb 12, 2024 9:53 am
chemocean wrote: Mon Feb 12, 2024 9:29 am
tibbitts wrote: Mon Feb 12, 2024 12:12 am Don't convert the bond to electronic, since the OR would get lost in the translation. When my bank wouldn't redeem them (recent policy change), TD redeemed my EE-bonds by USmail in about 6 weeks two months ago; you have to supply a notarized form with your name (as the OR owner) and your social security number.
The “or” will not be lost in conversion. The converted bonds will be titled in the first name listed with the second name as secondary. However, the bonds will be “restricted”, which means that the secondary owner must agree to any changes in titling.
That's exactly what I meant by the OR being "lost" during conversion to electronic: you (the secondary owner) will lose your original redemption capability.
The secondary owner of converted EE bonds had view and transaction rights sometime after conversion, which would allow the secondary owner to redeem into their linked banking account. I don't remember if 1) I, as primary owner, had to manually provide this access or 2) TD provided them as a 'right" of an "or" owner on a paper bond.
tibbitts
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Re: Redeeming Paper EE Bonds

Post by tibbitts »

chemocean wrote: Fri Feb 16, 2024 10:34 am
tibbitts wrote: Mon Feb 12, 2024 9:53 am
chemocean wrote: Mon Feb 12, 2024 9:29 am
tibbitts wrote: Mon Feb 12, 2024 12:12 am Don't convert the bond to electronic, since the OR would get lost in the translation. When my bank wouldn't redeem them (recent policy change), TD redeemed my EE-bonds by USmail in about 6 weeks two months ago; you have to supply a notarized form with your name (as the OR owner) and your social security number.
The “or” will not be lost in conversion. The converted bonds will be titled in the first name listed with the second name as secondary. However, the bonds will be “restricted”, which means that the secondary owner must agree to any changes in titling.
That's exactly what I meant by the OR being "lost" during conversion to electronic: you (the secondary owner) will lose your original redemption capability.
The secondary owner of converted EE bonds had view and transaction rights sometime after conversion, which would allow the secondary owner to redeem into their linked banking account. I don't remember if 1) I, as primary owner, had to manually provide this access or 2) TD provided them as a 'right" of an "or" owner on a paper bond.
I didn't know that.

Primary owner: person1 ssn 1
Secondary owner: person2 ssn 2

This wouldn't have helped me since person1 didn't have or want a TD account (and I was person2), but you're saying if person1 did have a TD account, I could have logged in to my own account as person2 and redeemed the bonds to my person2 linked account and had the interest correctly credited to ssn2?

The linked account would be able to be owned only by person2, and the interest reported accurately for ssn 2?
chemocean
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Re: Redeeming Paper EE Bonds

Post by chemocean »

tibbitts wrote: Fri Feb 16, 2024 11:14 am
chemocean wrote: Fri Feb 16, 2024 10:34 am
tibbitts wrote: Mon Feb 12, 2024 9:53 am
chemocean wrote: Mon Feb 12, 2024 9:29 am
tibbitts wrote: Mon Feb 12, 2024 12:12 am Don't convert the bond to electronic, since the OR would get lost in the translation. When my bank wouldn't redeem them (recent policy change), TD redeemed my EE-bonds by USmail in about 6 weeks two months ago; you have to supply a notarized form with your name (as the OR owner) and your social security number.
The “or” will not be lost in conversion. The converted bonds will be titled in the first name listed with the second name as secondary. However, the bonds will be “restricted”, which means that the secondary owner must agree to any changes in titling.
That's exactly what I meant by the OR being "lost" during conversion to electronic: you (the secondary owner) will lose your original redemption capability.
The secondary owner of converted EE bonds had view and transaction rights sometime after conversion, which would allow the secondary owner to redeem into their linked banking account. I don't remember if 1) I, as primary owner, had to manually provide this access or 2) TD provided them as a 'right" of an "or" owner on a paper bond.
I didn't know that.

Primary owner: person1 ssn 1
Secondary owner: person2 ssn 2

This wouldn't have helped me since person1 didn't have or want a TD account (and I was person2), but you're saying if person1 did have a TD account, I could have logged in to my own account as person2 and redeemed the bonds to my person2 linked account and had the interest correctly credited to ssn2?

The linked account would be able to be owned only by person2, and the interest reported accurately for ssn 2?
In a converted bond with "or" designation, person1 ssn1 and person2 SSN2 both have TD accounts in the situation that I introduced above. Person 2 has been given transaction rights to specific bonds in person1's account, for which Person 2 is a secondary owner of these bonds. In this case, my understanding that person2 could redeem the bonds, deposit the proceeds to their linked bank account and the accrued interest would be assigned to SSN2.

The linked account that I referenced is the bank account linked to the TD account, which is required for every TD account. The linked account is not a account to another SSN.
tibbitts
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Re: Redeeming Paper EE Bonds

Post by tibbitts »

chemocean wrote: Sat Feb 17, 2024 10:08 pm In a converted bond with "or" designation, person1 ssn1 and person2 SSN2 both have TD accounts in the situation that I introduced above. Person 2 has been given transaction rights to specific bonds in person1's account, for which Person 2 is a secondary owner of these bonds. In this case, my understanding that person2 could redeem the bonds, deposit the proceeds to their linked bank account and the accrued interest would be assigned to SSN2.

The linked account that I referenced is the bank account linked to the TD account, which is required for every TD account. The linked account is not a account to another SSN.
I didn't know that was possible but thanks for the reply. In my case it wouldn't have helped, given person1 not having a TD account, so I ended up redeeming vs. converting paper bonds (as the "OR" owner.) But I can see it being useful for other people.
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