The Series EE Bond (often referred to as a "Patriot Bond") is a non-marketable, interest-bearing U.S. government savings bond. These bonds are guaranteed to at least double in value over the typical 20-year initial term. Some Series EE bonds have total interest-paying lives that extend beyond the original maturity date, up to 30 years from issuance. Coupon rates for Series EE Bonds are determined at the time of issuance and are based on the percentage of the long-term Treasury rates.
Key Takeaways
Series EE Bonds are interest-bearing U.S. government savings bonds guaranteed to at least double in value over their typical 20-year initial terms.
Some Series EE bonds pay interest beyond the original maturity date, up to 30 years from issuance.
There is a $25 minimum investment requirement for EE bonds.
Every investor may purchase up to $10,000 in these bonds each calendar year.
Series EE bonds issued after May 2005 are assigned semi-annual fixed coupon rates on May 1 and November 1. The rates apply to all issuances for the ensuing six months. Bonds issued after each date increase in value monthly, but interest payments are handed out semiannually.
Series EE bonds are considered ultra-safe, low-risk investments, whose interest is typically exempt from state and local taxes. However, they are subject to federal taxes, but only in the year in which the bond matures or is redeemed. EE Bonds may be purchased by U.S. citizens, official U.S. residents, minors, and all U.S. government employees—regardless of their citizenship status.
Special Considerations
Paper EE bonds were re-issued as "Patriot Bonds" after the Sept. 11, 2001, terrorist attacks. They are identical in every way to the paper Series EE Bonds except that any paper bonds purchased through a financial institution after Dec. 10, 2001, have the words "Patriot Bond" printed on the top half of the bond certificate, situated between the Social Security Number (SSN) and the issue date. Financial institutions no longer issue Series EE bonds in paper form, but the paper Patriot Bonds can still be cashed or converted into electronic bonds.
Series EE bonds don't need to be reissued to correct small typographical errors in names, addresses, or Social Security numbers.
Requirements for a Series EE Bond
There is a $25 minimum investment requirement for EE bonds, and each investor may purchase up to $10,000 in these bonds each calendar year. Furthermore, bondholders must hold onto these investments for at least twelve months, before they can redeem the bonds. Those who redeem bonds within five years will be docked three months of accrued interest payments. Since EE bonds earn interest for up to 30 years, the longer they're held, the more they're worth.
Paper bondswere issued at a 50% discount to par, while bonds electronically sourced through TreasuryDirect are purchased at face value. The latter is still guaranteed to be worth twice their original value at first maturity date after 20 years while paying interest the same way as paper EE bonds.
Question: What is the Series I bond? Answer: The Series I bond is an accrual type savings bond tied to inflation. The bond is issued at face value. with a 30-year final maturity--a 20-year original maturity period immediately followed by a 10-year extended maturity period.
https://www.treasurydirect.gov › forms › savpdp0039
are a low-risk way to save money. They earn interest regularly for 30 years (or until you cash them if you do that before 30 years). For EE bonds you buy now, we guarantee that the bond will double in value in 20 years, even if we have to add money at 20 years to make that happen.
Bonds issued in May 2005 or later have an initial maturity of 20 years, at which point the government guarantees you'll receive double your initial investment. You can hold your bond for another 10 years and still earn interest, however. “Series EE bonds can be redeemed after the first year,” Yeomans said.
If you purchase a Series EE bond today, you are guaranteed to earn a fixed interest rate for 20 years, which is when the bond matures. At 20 years, the government ensures that you will be paid double the face value of the bond.
The government guarantees they will double in value in 20 years, even if it must add money to your account to make that happen. When do Series EE savings bonds mature? Series EE savings bonds issued since May 2005 mature in 20 years, at which time they will have doubled in value.
Owners can wait to pay the taxes when they cash in the bond, when the bond matures, or when they relinquish the bond to another owner. Alternatively, they may pay the taxes yearly as interest accrues. 1 Most owners choose to defer the taxes until they redeem the bond.
You can cash in (redeem) your EE bond after 12 months. However, if you cash in the bond in less than 5 years, you lose the last 3 months of interest. For example, if you cash in the bond after 18 months, you get the first 15 months of interest.
EE bonds you buy now have a fixed interest rate that you know when you buy the bond. That rate remains the same for at least the first 20 years. It may change after that for the last 10 of its 30 years. We guarantee that the value of your new EE bond at 20 years will be double what you paid for it.
You can skip paying taxes on interest earned with Series EE and Series I savings bonds if you're using the money to pay for qualified higher education costs. That includes expenses you pay for yourself, your spouse or a qualified dependent. Only certain qualified higher education costs are covered, including: Tuition.
After 20 years, the Patriot Bond is guaranteed to be worth at least face value. So a $50 Patriot Bond, which was bought for $25, will be worth at least $50 after 20 years. It can continue to accrue interest for as many as 10 more years after that.
When those bonds mature and stop earning interest, it is time to redeem them. Redeeming bonds is easy - just take them to a local bank or send them to the Bureau of the Fiscal Service.
Series EE, Series E, and Series I bonds can be cashed at a local financial institution. Some of these transactions may have to be forwarded for further processing. Series HH and Series H bonds must be sent to one of the addresses shown at the bottom of the following page.
If you're cashing in a paper savings bond of $1,000 or less, you'll need FS Form 1522 and a copy of your driver's license, passport, state ID or military ID. If the bond amount is more than $1,000, you must have your signature certified by a notary or certifying officer.
As of July 2024, there were 96 million matured unredeemed savings bonds held by investors. If bonds are held past their maturity date, the bonds can lose value due to inflation. To understand how this value is lost, see the illustration below. Imagine you bought a series EE bond 30 years ago for $500.
All Series EE Bonds reach final maturity 30 years from issue. All Series EE bonds reach final maturity 30 years from issue. Series EE savings bonds purchased from May 1995 through April 1997 increase in value every six months.
Bottom line. I bonds, with their inflation-adjusted return, safeguard the investor's purchasing power during periods of high inflation. On the other hand, EE Bonds offer predictable returns with a fixed-interest rate and a guaranteed doubling of value if held for 20 years.
Another thing to note: Savings bonds don't get a step-up in basis at death the way stocks or other investments do. That means you have to pay tax on the full amount of interest due on the bonds as the inheritor.
Introduction: My name is Dan Stracke, I am a homely, gleaming, glamorous, inquisitive, homely, gorgeous, light person who loves writing and wants to share my knowledge and understanding with you.
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