Paper financial savings bonds are nonetheless sitting in drawers, safes, and protected deposit packing containers throughout America and cashing one in 2026 is a bit of tougher than it was once.
Financial savings bonds at the moment are offered virtually completely in digital type by means of TreasuryDirect. The final option to get a brand new paper bond — the tax-time paper I bond program — ended on January 1, 2025. Meaning each paper financial savings bond out there’s a legacy doc, and the infrastructure for cashing them retains shrinking: fewer banks will redeem them over-the-counter, and extra redemptions are going by means of the mail to the Treasury.
There’s additionally a brand new wrinkle for 2026: when you’re in default on federal pupil loans, the federal government can intercept your financial savings bond cost by means of the Treasury Offset Program while you redeem by mail or by means of TreasuryDirect. We cowl that under.
Here is every part you have to find out about cashing a paper financial savings bond in 2026.
What Are Financial savings Bonds And How Do They Work?
Financial savings bonds have been round since 1935. While you purchase federal financial savings bonds, you’re lending cash to the federal government, which agrees to pay that cash again later, with curiosity.
The U.S. presently provides two varieties of financial savings bonds: Sequence EE and Sequence I. Each earn curiosity for 30 years. You may redeem a bond after holding it for one 12 months, however when you money it earlier than 5 years, you forfeit the final three months of curiosity.
In case your paper bond is greater than 30 years outdated, it has stopped incomes curiosity solely — the cash is simply sitting there dropping worth to inflation. The Treasury estimates billions of {dollars} in matured, unredeemed financial savings bonds are nonetheless excellent.
Unsure what your bond is price? Use the Financial savings Bond Calculator at TreasuryDirect.gov. You may want the collection, denomination, and problem date printed on the face of the bond.
The place To Money A Paper Financial savings Bond
You may have two choices: a financial institution or credit score union, or mailing the bond to the Treasury.
Possibility 1: Your Financial institution Or Credit score Union
Many banks nonetheless money paper Sequence E, EE, and I bonds — however that is getting tougher yearly. Banks should not required to redeem financial savings bonds, and most have tightened their insurance policies:
Most banks will solely money bonds for established prospects — the Secret Service recommends (and plenty of banks require) that you’ve held an account for at the very least 12 months earlier than they will redeem bonds for you. Many banks additionally cap the greenback quantity they will redeem in a single go to, and a few branches have stopped cashing bonds solely.
Name your financial institution earlier than you go. Ask whether or not they redeem financial savings bonds, whether or not there is a greenback restrict, and what identification they require.
The upside of the financial institution route: you get your cash instantly, and the cost is made over-the-counter by the financial institution.
Possibility 2: Mail Your Bonds To The Treasury (FS Kind 1522)
In case your financial institution will not money your bonds — or you may have a big batch — you’ll be able to redeem them straight with the Treasury:
- Fill out FS Kind 1522 (Particular Type of Request for Fee of United States Financial savings and Retirement Securities). TreasuryDirect has step-by-step directions.
- If the full worth of the bonds is $1,000 or much less, you’ll be able to merely signal the shape and embody a duplicate of your government-issued ID. If the worth is greater than $1,000, you need to signal the shape in entrance of a certifying officer (most banks and credit score unions supply signature certification — a notary stamp alone just isn’t accepted).
- Embrace your financial institution routing and account numbers on the shape for direct deposit.
- Mail the unsigned bonds and accomplished type to: Treasury Retail Securities Companies, P.O. Field 9150, Minneapolis, MN 55480-9150.
Anticipate processing to take a number of weeks — the Treasury presently says at the very least six weeks in lots of instances. Think about mailing with monitoring. Do not signal the backs of the bonds themselves.
The Treasury additionally has particular procedures for much less widespread conditions: bonds owned by minors, deceased homeowners’ estates, identify adjustments, and homeowners residing outdoors the U.S. Particulars are on TreasuryDirect’s cashing web page.
When Ought to You Money A Paper Financial savings Bond?
There are a couple of situations the place cashing your paper financial savings bond is sensible:
The bond is greater than 30 years outdated. It has stopped incomes curiosity. There isn’t any profit to persevering with to carry it — redeem it and put the cash to work elsewhere.
You may earn extra elsewhere. Relying on when your bond was issued, its charge could also be nicely under what you might earn in a high-yield financial savings account, CD, or a diversified index fund portfolio. Verify your bond’s present charge with the Financial savings Bond Calculator earlier than deciding.
You want the cash. Bonds greater than a 12 months outdated can all the time be redeemed. Simply bear in mind the three-month curiosity penalty if the bond is lower than 5 years outdated.
Yet one more possibility price figuring out: as an alternative of cashing paper bonds, you’ll be able to convert them to digital bonds in TreasuryDirect utilizing its SmartExchange characteristic, which makes them simpler to trace and redeem later.
And when you assume you (or a deceased member of the family) would possibly personal bonds you’ll be able to’t discover, test Treasury Hunt at TreasuryDirect.gov — it is the Treasury’s free search device for matured, unredeemed bonds.
Do I Owe Taxes After I Money A Paper Financial savings Bond?
Sure, however simply on the curiosity. Financial savings bond curiosity is topic to federal revenue tax (however exempt from state and native revenue tax). Except you elected to report the curiosity yearly (most individuals do not), all of the curiosity is taxable within the 12 months you redeem the bond.
If you happen to money at a financial institution, the financial institution will problem Kind 1099-INT — both on the spot or by mail the next January. If you happen to redeem by mail or by means of TreasuryDirect, your 1099-INT will probably be obtainable from the Treasury.
One potential tax break: when you use the proceeds of Sequence EE or I bonds for certified increased schooling bills in the identical 12 months, you could possibly exclude some or the entire curiosity from revenue. The schooling exclusion has revenue limits and different necessities — see IRS Kind 8815 for particulars.
An offset does not change your tax invoice, both. If a part of your redemption is taken for a defaulted pupil mortgage, the curiosity continues to be taxable revenue to you within the 12 months of redemption.
The Backside Line
Cashing a paper financial savings bond in 2026 takes a bit of extra planning than it used to. Name your financial institution first — if they will redeem your bonds, that is the quickest route. If not, FS Kind 1522 and a visit to the put up workplace will get it executed in a couple of weeks.
In case your bonds are greater than 30 years outdated, do not wait: they stopped incomes curiosity way back. And when you’re in default on federal pupil loans, cope with the default (or at the very least know your offset standing) earlier than you mail bonds to the Treasury — in any other case your redemption test could go towards your loans as an alternative of your checking account.
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