Paying taxes on savings bonds

[Riley.]

I had EE savings bonds and when I cashed them in, they were considered income.

[Lillie767]

Originally Posted by Riley.

I had EE savings bonds and when I cashed them in, they were considered income.

Yes- it's income, but Series EE income is interest income, reported on a 1099-INT.


If he received a 1099-B and was told to report the info on Schedule D, then these were not EE savings bonds.

[mike1003]

Originally Posted by robertpasa

When you have a govt savings bond and get interest, you have to pay taxes on the interest.

When the bond matures and you get the principal back, is the principal taxable? I think not but I wanted to make sure.

NO, only the interest (or dividends with bonds)


The principle is yours

[robertpasa]

Originally Posted by Lillie767

What type of "govt savings bond" did you have?

Series E, Series I or was it not a savings bond but a govt issued bond?

Redemptions of Series E bonds are reported on 1099-INT.

Long term bonds, not like E or I.

Why is there a tax on EE bonds on the principal?
I don't have those but would like to know.

[ChessieMom]

Originally Posted by robertpasa

Long term bonds, not like E or I.

Why is there a tax on EE bonds on the principal?
I don't have those but would like to know.

There isn't.

https://www.treasurydirect.gov/savin...on-ee-i-bonds/

[robertpasa]

With bonds in general, when you get the principal back, it is NEVER taxable, is that right?

I guess with stocks, if you sell them at the same price as you bought them, there would not be a tax, but there would be on the dividends, if any.

[Coney]

The theory behind EE bonds is that the purchaser already paid taxes on the principle. The "new" money is the interest which has not been taxed until the bond is redeemed.