Where and how to cash a savings bond

You can cash a savings bond at most banks and credit unions, or directly through the U.S. Department of the Treasury if you own the bond in electronic form. If you hold a paper bond, take it to any financial institution where you have an account — they will verify the bond's serial number and current value, then deposit the proceeds into your account. If you own the bond electronically through TreasuryDirect (the Treasury's online platform), you log into your account, select the bond you want to redeem, and the money appears in your linked bank account within one to three business days.

The process differs slightly depending on whether your bond has reached its final maturity date. A bond that has matured stops earning interest, so there is no penalty for cashing it whenever you choose. A bond that has not yet matured will incur a penalty if you cash it early — typically the loss of the last three months of interest.

You do not need the original purchase documents or proof of ownership to cash a paper bond at a bank, though you will need to sign the back of the bond in front of a bank employee or notary. If someone else's name is on the bond along with yours, both owners must be present to cash it, or the absent owner must sign a power of attorney.

Key Takeaways

  • Paper savings bonds can be cashed at any bank or credit union; electronic bonds are redeemed through your TreasuryDirect account online.
  • Bonds that have not reached their final maturity date will lose the last three months of interest if you cash them early.
  • Series EE and Series I bonds must be held for at least one year before you can cash them, and cashing before five years have passed triggers the three-month interest penalty.
  • The bank deposits the cash into your account on the spot for paper bonds, or within one to three business days for electronic bonds.
  • If two people's names are on the bond, both must be present or one must have a signed power of attorney.

The one-year and five-year holding periods

Series EE bonds and Series I bonds cannot be cashed at all during the first year you own them. This is a hard rule — no exceptions. If you try to redeem one before 12 months have passed, the bank will refuse.

After one year, you can cash the bond, but if you do so before five years have passed, you lose the last three months of interest you earned. For example, if you bought a Series I bond in January 2023 and cash it in March 2024 (14 months later), you forfeit the interest from October 2023 through December 2023. The bank calculates this automatically and deducts it from your redemption amount.

Series HH bonds, which are no longer sold but are still held by many people, have different rules: they can be redeemed after six months, but the three-month interest penalty applies if you cash them before five years have passed.

What happens to the interest you earned

When you cash a bond, you receive the principal (the amount you paid for it) plus all the interest it has earned, minus any early-redemption penalty. The interest is paid in a lump sum at the time of redemption — you do not receive it in monthly or annual payments.

The interest on savings bonds is subject to federal income tax, but not to state or local income tax. You will owe federal tax on the interest in the year you cash the bond, unless you have been reporting the interest annually as it accrued (which most people do not do). The bank does not withhold tax automatically, so you may owe money at tax time. If you cashed multiple bonds or received other income that year, your total tax bill could be higher than expected.

If you inherited a savings bond from someone who died, the interest that accrued before their death is taxed to their estate, not to you. Only the interest earned after their death is taxed to you when you eventually cash it.

Cashing a bond you do not own but are authorized to redeem

If you are the designated beneficiary or power of attorney for someone else's savings bond, you can cash it on their behalf, but the process requires additional paperwork. You will need to bring a document that proves your authority — either the bond itself (which names you as beneficiary), a power of attorney signed by the bond owner, or a court order if you are acting as a guardian or conservator.

If the bond owner has died, you will need a certified copy of the death certificate and proof that you are the named beneficiary or the executor of their estate. The bank will verify this information before releasing the funds. The interest earned after the owner's death is taxed to you in the year you redeem the bond.

What to do if your bond is lost, stolen, or damaged

If you own a paper bond and it is lost or stolen, contact the Treasury directly through the Bureau of the Fiscal Service. You will need to provide the bond's serial number, the series (EE, I, or HH), the issue date, and the denomination. The Treasury can research whether the bond has been cashed and, if it has not, can issue a replacement or pay you the current value.

If the bond is damaged but still readable, most banks will accept it for redemption. If it is too damaged to read, the bank can send it to the Treasury for verification and replacement. This process takes several weeks.

If you own the bond electronically through TreasuryDirect, loss or theft is not a concern because the bond exists only in your online account, which is protected by your login credentials and password.

Tax reporting when you cash a bond

When you cash a savings bond, the bank does not issue a Form 1099-INT (the tax form for interest income) automatically. You are responsible for reporting the interest on your federal tax return. If you cashed bonds worth more than $1,500 in interest during the year, the bank may issue a 1099-INT, but this is not may provide.

Keep a record of the bond's purchase price, the date you cashed it, and the total amount you received. Subtract the purchase price from the total to find the interest earned. Report this interest as income on your tax return in the year you cashed the bond.

If you cashed a bond before five years had passed and lost three months of interest to the penalty, you still report the interest you actually received — the penalty is already factored into the amount the bank gave you.

Frequently Asked Questions

Can I cash a savings bond at any bank?

Most banks and credit unions will cash savings bonds for their customers, but some smaller institutions may decline. Call ahead to confirm. If your bank will not cash it, the Treasury will redeem it by mail — you send the bond and a form to the Bureau of the Fiscal Service, and they mail you a check within four to six weeks.

What if I do not know the current value of my bond?

The Treasury publishes a savings bond calculator on TreasuryDirect.gov where you can enter the bond's series, denomination, and issue date to see its current value. If you own the bond electronically, your TreasuryDirect account displays the value automatically. Paper bonds do not have a printed value because they earn interest over time.

Do I have to cash the entire bond, or can I cash part of it?

You must cash the entire bond — you cannot redeem half of it and keep the other half earning interest. If you own multiple bonds, you can choose which ones to cash and leave the others untouched.

What if the bond is in my child's name?

If the bond is registered in your child's name only, your child must be present to sign it and consent to the redemption, even if you are their parent. If the bond is in both your name and your child's name, either of you can cash it alone. If your child is a minor and you need to cash a bond in their name, you will need to bring a birth certificate or other proof of the parent-child relationship, and the child must sign or you must have a power of attorney.

Can I cash a bond if I do not have a bank account?

You will need a bank or credit union account to deposit the proceeds. If you do not have one, you can open a basic savings account at most banks with minimal requirements — usually just an ID and a small deposit. Alternatively, you can redeem the bond by mail through the Treasury, which will send you a check.