Yes, you can buy bonds on Robinhood, but the selection is limited to corporate bonds and Treasury bonds

Robinhood lets you buy individual bonds directly through its platform, but not every type of bond is available. You can purchase corporate bonds (debt issued by companies) and Treasury bonds (debt issued by the U.S. government). Municipal bonds, bond funds, and bond ETFs are not offered on Robinhood.

The bonds available change based on what issuers are currently selling and what Robinhood's inventory includes. You search for bonds by ticker or issuer name, see the current price and yield, and buy them the same way you would buy a stock — through your Robinhood account.

Robinhood does not charge a commission to buy or sell bonds, which is different from many traditional brokers. However, the price you see already includes a markup that Robinhood takes, so you are not seeing the true wholesale price.

Key Takeaways

  • Robinhood offers corporate bonds and Treasury bonds, but not municipal bonds, bond funds, or ETFs.
  • You can search for bonds by company or government issuer name and buy them commission-free through your account.
  • The price displayed includes Robinhood's markup, so the actual cost to you is higher than the wholesale market price.
  • Bonds on Robinhood must be held until maturity or sold back to the market; you cannot transfer them to another broker.
  • Your account type (taxable, IRA, or other) determines the tax treatment of interest and gains when you sell before maturity.

What types of bonds Robinhood actually has in stock

Corporate bonds are the most common type available on Robinhood. These are issued by public companies and typically pay interest every six months until the bond matures. The selection varies — some days Robinhood may have hundreds of corporate bonds available, other days fewer. You can filter by maturity date, coupon rate (the interest rate), and credit rating to narrow your search.

Treasury bonds are issued by the U.S. Department of the Treasury and backed by the federal government. Robinhood offers Treasury bonds with different maturity dates, ranging from shorter-term to longer-term bonds. These are considered lower-risk than corporate bonds because they are backed by the U.S. government.

Robinhood does not offer municipal bonds (issued by states and cities), bond mutual funds, or bond ETFs (exchange-traded funds that hold many bonds). If you want to invest in municipal bonds or hold a diversified bond portfolio through a fund, you would need to use a different broker.

How the pricing and markup work when you buy

When you look up a bond on Robinhood, the price shown is what you will pay — there is no separate commission added at checkout. However, Robinhood has already built in its profit margin. The wholesale price (what Robinhood paid for the bond) is lower than what you see on screen.

This markup is standard in the bond market and is how Robinhood makes money on bond sales without charging a commission. The size of the markup varies depending on the bond, the issuer, and market conditions. You cannot see the markup amount separately — it is baked into the price.

If you sell a bond before it matures, you will sell it at the current market price, which may be higher or lower than what you paid. The difference between your purchase price and your sale price is your gain or loss.

Minimum purchase amounts and account requirements

Most bonds on Robinhood have a minimum purchase of $1,000 per bond. Some bonds may have higher minimums, and this information appears on the bond's detail page before you buy. You need a funded Robinhood account to purchase bonds — you cannot buy them in a cash account with a zero balance.

Bonds can be held in any Robinhood account type: a taxable brokerage account, a traditional IRA, a Roth IRA, or a SEP IRA. The account type affects how the interest income and any gains are taxed, but does not change whether you can buy the bond itself.

Tax treatment of bond interest and gains

Interest paid by corporate bonds is taxed as ordinary income at your federal tax rate, plus state and local taxes if applicable. This is true regardless of whether you hold the bond in a taxable account or a tax-advantaged account like an IRA.

If you sell a bond before maturity for more than you paid, that gain is a capital gain and is taxed based on how long you held it. If you held it for less than one year, it is a short-term capital gain taxed as ordinary income. If you held it for more than one year, it is a long-term capital gain taxed at a lower rate.

In a traditional IRA or SEP IRA, interest and gains are not taxed while the money stays in the account. In a Roth IRA, interest and gains are not taxed at all, even when you withdraw them in retirement. In a taxable account, you owe taxes on interest each year and on gains when you sell.

Holding bonds until maturity versus selling early

When you buy a bond on Robinhood, you can hold it until the maturity date, at which point the issuer pays you back the full face value (usually $1,000 per bond) plus any final interest payment. You do not have to do anything — the payment arrives in your account automatically.

You can also sell a bond before maturity through Robinhood's platform. The price you receive depends on current market conditions and interest rates. If interest rates have risen since you bought the bond, its price will be lower. If interest rates have fallen, its price will be higher.

Bonds cannot be transferred out of Robinhood to another broker. If you want to move a bond you own on Robinhood to a different brokerage, you must sell it first and then buy it again at the new broker (if it is available there).

Comparing Robinhood bonds to other ways to invest in bonds

Robinhood's main advantage is no commission and a low minimum ($1,000 per bond). The main disadvantage is the limited selection and the hidden markup in pricing. If you want a wider range of bonds or lower markups, a traditional broker like Fidelity, Charles Schwab, or Vanguard may offer more options.

Bond ETFs and bond mutual funds are another way to invest in bonds without picking individual bonds yourself. These funds hold many bonds and spread your money across them, reducing the risk that any single issuer defaults. Robinhood does not offer bond funds, but other brokers do.

Treasury bonds can also be bought directly from the U.S. government through TreasuryDirect.gov with no markup and no broker involved. However, TreasuryDirect has a different interface and does not integrate with a brokerage account.

Frequently Asked Questions

Can I buy bonds in a Robinhood IRA?

Yes. Bonds can be held in a traditional IRA, Roth IRA, or SEP IRA on Robinhood. The account type determines how interest and gains are taxed, but does not prevent you from buying bonds. Interest earned in an IRA is not taxed until you withdraw it (or never, in a Roth).

What happens if the company that issued my bond goes bankrupt?

If a company defaults on its bonds, you may lose some or all of your investment. Corporate bonds are riskier than Treasury bonds for this reason. Robinhood shows the credit rating of each bond, which reflects the issuer's financial health. Higher-rated bonds are considered safer but pay lower interest.

Can I sell a bond I bought on Robinhood before it matures?

Yes. You can sell any bond through Robinhood's platform at the current market price. The price may be higher or lower than what you paid, depending on interest rates and the issuer's credit quality. You will realize a gain or loss on the sale.

Why is the price I see on Robinhood different from the price on other websites?

Bond prices vary by broker because each broker adds its own markup. Robinhood's markup is built into the displayed price. Different brokers may also have different bonds in stock. Comparing prices across brokers before buying can help you understand the markup you are paying.

Do I get a 1099 form for bond interest earned on Robinhood?

Yes. Robinhood sends a 1099-INT form each January for interest earned in the previous year on bonds held in a taxable account. If you hold bonds in an IRA, you do not receive a 1099 because the interest is not taxed until withdrawal (or not at all in a Roth).