I Bonds Mega Thread (I Bond Heads Rejoice!)

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SnowBog
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by SnowBog »

invester123 wrote: Sat Jan 01, 2022 7:59 pm Put 10k in October 2021 and got the 3 something% rate which will go on to 7.12% in a couple of months. I'm ready to buy my 2022 I Bonds now. Am I officially able to do so since its 2022? I want to buy now. 10ks ready to go.
Yes. But the earliest it will process is Monday, at that's the first business day.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by dj420 »

does any one know when the interest is paid on these i bonds i bought in November and havent see any interest in account so far
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by JayDee37 »

dj420 wrote: Sun Jan 02, 2022 12:42 am does any one know when the interest is paid on these i bonds i bought in November and havent see any interest in account so far
There is a three month lag in the reported interest to account for the three month early redemption penalty. So no interest appears for the first 3 months. Then you get one month at a time (starting on the 4th month), and after the 5 year holding period is up that missing three months of interest will appear all at once.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by MrJedi »

dj420 wrote: Sun Jan 02, 2022 12:42 am does any one know when the interest is paid on these i bonds i bought in November and havent see any interest in account so far

First day of each month.

As mentioned above there is a 3 monthly early redemption penalty for redemptions before 5 years. The balance shown reflects that penalty. You should see some interest during the 4th month (March 2022) since the bond will reflect 4 months of interest minus 3 months of penalty.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by icarus18 »

I posted this question in a different thread but this seems a better
venue:

Has anyone successfully gotten a chase bank branch to sign the bank official signature form to set up the treasury direct account? Is there a magic name or phrase that will help them determine who I need to speak to?
At the two branches I have tried, I got looks like I was speaking Klingon when trying to ask, and both times didn't get anywhere.

I do my main banking with Schwab so I chatted their customer service to see if I could do it with them somehow and basically got the "we don't do that".

Not sure what else to try here?
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HomeStretch »

No, a couple months ago Chase refused to sign the TD form for my FIL (a long-time Chase banking customer).

Schwab may be willing to sign the form if one of the bank accounts you are adding is a Schwab account.

Recently my local Fidelity office provided a guarantee for the TD form to add a bank account as I was adding my Fidelity CMA account as one of the accounts. I mentioned as I handed over the form that adding my Fidelity CMA would allow me to transfer I-Bonds proceeds into the CMA.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HueyLD »

HomeStretch wrote: Sun Jan 02, 2022 7:11 am No, a couple months ago Chase refused to sign the TD form for my FIL (a long-time Chase banking customer).

Schwab may be willing to sign the form if one of the bank accounts you are adding is a Schwab account.

Recently my local Fidelity office provided a guarantee for the TD form to add a bank account as I was adding my Fidelity CMA account as one of the accounts. I mentioned as I handed over the form that adding my Fidelity CMA would allow me to transfer I-Bonds proceeds into the CMA.
Fidelity’s willingness to provide MSG is very much location dependent.

I was told over the phone that they would only provide MSG for accounts related to Fidelity. However, they had no issues whatsoever to stamp my TD form even though I did not mention Fidelity in my request for MSG.

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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by pjm »

I asked this in another forum but maybe this is where all the I Bonds experts are:

Is there any legal limit on how many revocable Trusts can we registered with TD under my SSN? Say somebody has 5 different Trusts for each individual beneficiary. Does that mean each Trust can we registered with TD and make 5X $10k purchases?
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

pjm wrote: Sun Jan 02, 2022 7:56 pm I asked this in another forum but maybe this is where all the I Bonds experts are:

Is there any legal limit on how many revocable Trusts can we registered with TD under my SSN? Say somebody has 5 different Trusts for each individual beneficiary. Does that mean each Trust can we registered with TD and make 5X $10k purchases?
If you look around these I Bond threads, I think you'll find some folks have used a lot of trusts to load up on I Bonds.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by pjm »

Mel Lindauer wrote: Sun Jan 02, 2022 8:10 pm
pjm wrote: Sun Jan 02, 2022 7:56 pm I asked this in another forum but maybe this is where all the I Bonds experts are:

Is there any legal limit on how many revocable Trusts can we registered with TD under my SSN? Say somebody has 5 different Trusts for each individual beneficiary. Does that mean each Trust can we registered with TD and make 5X $10k purchases?
If you look around these I Bond threads, I think you'll find some folks have used a lot of trusts to load up on I Bonds.
Right. I seem people do 1-2 trusts per person/SSN. But is there any statutory limit on how many Trusts accounts a person can establish with TD per SSN?
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

pjm wrote: Mon Jan 03, 2022 12:06 pm
Mel Lindauer wrote: Sun Jan 02, 2022 8:10 pm
pjm wrote: Sun Jan 02, 2022 7:56 pm I asked this in another forum but maybe this is where all the I Bonds experts are:

Is there any legal limit on how many revocable Trusts can we registered with TD under my SSN? Say somebody has 5 different Trusts for each individual beneficiary. Does that mean each Trust can we registered with TD and make 5X $10k purchases?
If you look around these I Bond threads, I think you'll find some folks have used a lot of trusts to load up on I Bonds.
Right. I seem people do 1-2 trusts per person/SSN. But is there any statutory limit on how many Trusts accounts a person can establish with TD per SSN?
I can't remember who posted it, but I recall seeing someone post that they had purchased the limit for each of perhaps 10 or more trusts, so there doesn't appear to be any limit. You can also do it for your business if you have one.
Best Regards - Mel | | Semper Fi
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by 09deaconX »

So, shame on me for waiting until New Year's Eve, but on 12/31 I finally pulled the trigger on purchasing I Bonds. That said, when I look at the transaction history on my account I see the following:

Purchase Requested: 12/31/2021
Security Issued: 1/3/2022

I'm assuming that this means that my purchase counts towards my 2022 Calendar Year Limits, and not 2021? This seems like a straightforward question but I was having trouble finding an answer online (on the TreasuryDirect site or here). If so, I'll take it as a small "dumb tax" for not being more pro-active in figuring out what I wanted to do here.

Thanks in advance for anyone who can confirm!
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HueyLD »

09deaconX wrote: Tue Jan 04, 2022 9:02 am So, shame on me for waiting until New Year's Eve, but on 12/31 I finally pulled the trigger on purchasing I Bonds. That said, when I look at the transaction history on my account I see the following:

Purchase Requested: 12/31/2021
Security Issued: 1/3/2022

I'm assuming that this means that my purchase counts towards my 2022 Calendar Year Limits, and not 2021? This seems like a straightforward question but I was having trouble finding an answer online (on the TreasuryDirect site or here). If so, I'll take it as a small "dumb tax" for not being more pro-active in figuring out what I wanted to do here.

Thanks in advance for anyone who can confirm!
Log into your TD account and look at the security issue date. It should show 12/1/2021 if it made it to December. Otherwise, it will show 1/1/2022 for January issuance.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

BrokerageZelda wrote: Sat Jan 01, 2022 11:43 am
NewbieBogle007 wrote: Sat Jan 01, 2022 11:35 am Any tips on timing when to buy for this year?
Here are my thoughts from an earlier post:
viewtopic.php?p=6404091#p6404091

My answer in short: if you can afford to and want to max out, do it in late January. The fixed rate is unlikely to rise anytime soon, and I want to lock in the way-above-average inflation rate for 6 months and have the money accessible again (run out the 12 month clock) as soon as possible.
This is good advice and the same thing I would have posted had BrokerageZelda not already done so.
Best Regards - Mel | | Semper Fi
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why is my ibond rate only 3.54 vs 7.12 for an old purchase

Post by relampago »

[Thread merged into here --admin LadyGeek]

A number of years ago I purchased ibonds and never looked at them until recently. Why are all but this one with issue date of 04-01-2013 at 3.54%?


Issue Date Interest Rate Status Amount Current Value
11-01-2021 7.12% $10,000.00 $10,000.00
12-01-2014 7.12% $10,000.00 $11,368.00
05-01-2013 7.12% $5,000.00 $5,842.00

04-01-2013 3.54% $5,000.00 $5,768.00

12-01-2012 7.12% $5,000.00 $5,854.00
12-01-2012 7.12% $5,000.00 $5,854.00
Last edited by relampago on Tue Jan 04, 2022 12:06 pm, edited 1 time in total.
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Re: why is my ibond rate only 3.54 vs 7.12 for an old purchase

Post by dukeblue219 »

relampago wrote: Tue Jan 04, 2022 12:04 pm A number of years ago I purchased ibonds and never looked at them until recently. Why are all but this one 3.54?


Issue Date Interest Rate Status Amount Current Value
11-01-2021 7.12% $10,000.00 $10,000.00
12-01-2014 7.12% $10,000.00 $11,368.00
05-01-2013 7.12% $5,000.00 $5,842.00
04-01-2013 3.54% $5,000.00 $5,768.00
12-01-2012 7.12% $5,000.00 $5,854.00
12-01-2012 7.12% $5,000.00 $5,854.00
That bond updates every April and October. Last October the rate was 3.54. In April, it will bump up to 7.12 and stay there for 6 months.
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Re: why is my ibond rate only 3.54 vs 7.12 for an old purchase

Post by BrokerageZelda »

relampago wrote: Tue Jan 04, 2022 12:04 pm A number of years ago I purchased ibonds and never looked at them until recently. Why are all but this one with issue date of 04-01-2013 at 3.54%?


Issue Date Interest Rate Status Amount Current Value
11-01-2021 7.12% $10,000.00 $10,000.00
12-01-2014 7.12% $10,000.00 $11,368.00
05-01-2013 7.12% $5,000.00 $5,842.00

04-01-2013 3.54% $5,000.00 $5,768.00

12-01-2012 7.12% $5,000.00 $5,854.00
12-01-2012 7.12% $5,000.00 $5,854.00
I Bonds don't all change rates at the same time, the six month rate calendar is shifted based on the month of purchase.

https://www.bogleheads.org/wiki/I_savin ... ings_rates

See the "New Rate Takes Effect" column in that section to see when each bond will change interest rates. You will always get a full six months of every rate; the shifting means that April and October bonds are the 'last' to pick up the new rates.
Last edited by BrokerageZelda on Tue Jan 04, 2022 12:12 pm, edited 2 times in total.
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Re: why is my ibond rate only 3.54 vs 7.12 for an old purchase

Post by relampago »

Thank you!!
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by LadyGeek »

I merged relampago's question into the ongoing discussion.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by lostInCo »

Studying to be a VITA this tax season.

One of the case studies talks about taking money from a CD before it matures and that the early withdrawal penalty of losing the last three months of interest can be used as an adjustment to income. Didn't know that... lots still to learn... Extrapolating-- if one pulls an I bond before five years, one also loses the last three months of interest. can this loss of interest on an I bond also be claimed as an adjustment to income? do I bonds trigger an 1099 INT when cashed in?
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by BrokerageZelda »

lostInCo wrote: Tue Jan 04, 2022 1:38 pm Studying to be a VITA this tax season.

One of the case studies talks about taking money from a CD before it matures and that the early withdrawal penalty of losing the last three months of interest can be used as an adjustment to income. Didn't know that... lots still to learn... Extrapolating-- if one pulls an I bond before five years, one also loses the last three months of interest. can this loss of interest on an I bond also be claimed as an adjustment to income? do I bonds trigger an 1099 INT when cashed in?
CD interest in a non-tax-advantaged account, unlike I Bond interest, is taxable at the time it's earned (just like in a savings account). So even if the CD isn't cashed out during a tax year, the interest credited to the account is added to taxable income every month. That's why you can get a credit on an early redemption penalty on a CD - you were already taxed on that interest on the 1099-INT, so if you're giving the interest back, you get a credit on the 1099-INT for the interest you lost.

I Bond interest taxation is deferred until the time of redemption. So even though you do 'lose' three months if you redeem before the five-year mark, you were never taxed on that interest in the first place, and there is no reason to credit you for reversal of taxable income. The three months of taxable income just never makes it to the 1099-INT in the first place.

(Yes, I Bonds do trigger a 1099-INT at the end of the year if redeemed in a given TreasuryDirect account.)
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by 3AEiue0y »

icarus18 wrote: Sun Jan 02, 2022 6:28 am I posted this question in a different thread but this seems a better
venue:

Has anyone successfully gotten a chase bank branch to sign the bank official signature form to set up the treasury direct account? Is there a magic name or phrase that will help them determine who I need to speak to?
At the two branches I have tried, I got looks like I was speaking Klingon when trying to ask, and both times didn't get anywhere.

I do my main banking with Schwab so I chatted their customer service to see if I could do it with them somehow and basically got the "we don't do that".

Not sure what else to try here?
I did the signature verification from my local branch. The signature verification was actually a notarization from the bank officer. The TD form says Notary is not acceptable. I got the bank official and the Treasury direct customer service representative on the same call and the treasury direct customer representative said the forms on their website is not updated to reflect this and I submitted the TD Account Authorization form - FS form 5444 - with the notarization from the chase bank officer and it was accepted.

Of course, it was a pain to make the bank officer to understand what was needed but the officer was nice enough to go the extra mile. Hope this helps.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by lostInCo »

got it-- thanks for the detailed response
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by SnowBog »

BrokerageZelda wrote: Tue Jan 04, 2022 1:44 pm
lostInCo wrote: Tue Jan 04, 2022 1:38 pm Studying to be a VITA this tax season.

One of the case studies talks about taking money from a CD before it matures and that the early withdrawal penalty of losing the last three months of interest can be used as an adjustment to income. Didn't know that... lots still to learn... Extrapolating-- if one pulls an I bond before five years, one also loses the last three months of interest. can this loss of interest on an I bond also be claimed as an adjustment to income? do I bonds trigger an 1099 INT when cashed in?
CD interest in a non-tax-advantaged account, unlike I Bond interest, is taxable at the time it's earned (just like in a savings account). So even if the CD isn't cashed out during a tax year, the interest credited to the account is added to taxable income every month. That's why you can get a credit on an early redemption penalty on a CD - you were already taxed on that interest on the 1099-INT, so if you're giving the interest back, you get a credit on the 1099-INT for the interest you lost.

I Bond interest taxation is deferred until the time of redemption. So even though you do 'lose' three months if you redeem before the five-year mark, you were never taxed on that interest in the first place, and there is no reason to credit you for reversal of taxable income. The three months of taxable income just never makes it to the 1099-INT in the first place.

(Yes, I Bonds do trigger a 1099-INT at the end of the year if redeemed in a given TreasuryDirect account.)
Just to expand on this slightly...

I Bonds automatically withhold the 3 month penalty. For example at the 1-year mark, you will have only gained interest from the first 9 months. So the 3 month penalty is already "built in" so to speak. Even if you opted to pay taxes annually on I Bond interest, you'll never see those 3 months (until you hit the 5-year mark where you basically get 3 "bonus" months of interest as the penalty is gone). In other words the tax deferral isn't the driver here... It's the fact that I Bonds automatically withhold the last 3-months of interest so long as the penalty applies.

With CDs, they show the interest gained. And the "penalty" removes from what was gained. Hence the adjustment to income.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by lostInCo »

SnowBog wrote: Tue Jan 04, 2022 2:46 pm
BrokerageZelda wrote: Tue Jan 04, 2022 1:44 pm
lostInCo wrote: Tue Jan 04, 2022 1:38 pm Studying to be a VITA this tax season.

One of the case studies talks about taking money from a CD before it matures and that the early withdrawal penalty of losing the last three months of interest can be used as an adjustment to income. Didn't know that... lots still to learn... Extrapolating-- if one pulls an I bond before five years, one also loses the last three months of interest. can this loss of interest on an I bond also be claimed as an adjustment to income? do I bonds trigger an 1099 INT when cashed in?
CD interest in a non-tax-advantaged account, unlike I Bond interest, is taxable at the time it's earned (just like in a savings account). So even if the CD isn't cashed out during a tax year, the interest credited to the account is added to taxable income every month. That's why you can get a credit on an early redemption penalty on a CD - you were already taxed on that interest on the 1099-INT, so if you're giving the interest back, you get a credit on the 1099-INT for the interest you lost.

I Bond interest taxation is deferred until the time of redemption. So even though you do 'lose' three months if you redeem before the five-year mark, you were never taxed on that interest in the first place, and there is no reason to credit you for reversal of taxable income. The three months of taxable income just never makes it to the 1099-INT in the first place.

(Yes, I Bonds do trigger a 1099-INT at the end of the year if redeemed in a given TreasuryDirect account.)
Just to expand on this slightly...

I Bonds automatically withhold the 3 month penalty. For example at the 1-year mark, you will have only gained interest from the first 9 months. So the 3 month penalty is already "built in" so to speak. Even if you opted to pay taxes annually on I Bond interest, you'll never see those 3 months (until you hit the 5-year mark where you basically get 3 "bonus" months of interest as the penalty is gone). In other words the tax deferral isn't the driver here... It's the fact that I Bonds automatically withhold the last 3-months of interest so long as the penalty applies.

With CDs, they show the interest gained. And the "penalty" removes from what was gained. Hence the adjustment to income.
Thanks, appreciate the details around the I bond gained interest nuance until year 5.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

BrokerageZelda wrote: Tue Jan 04, 2022 1:44 pm
lostInCo wrote: Tue Jan 04, 2022 1:38 pm Studying to be a VITA this tax season.

One of the case studies talks about taking money from a CD before it matures and that the early withdrawal penalty of losing the last three months of interest can be used as an adjustment to income. Didn't know that... lots still to learn... Extrapolating-- if one pulls an I bond before five years, one also loses the last three months of interest. can this loss of interest on an I bond also be claimed as an adjustment to income? do I bonds trigger an 1099 INT when cashed in?
CD interest in a non-tax-advantaged account, unlike I Bond interest, is taxable at the time it's earned (just like in a savings account). So even if the CD isn't cashed out during a tax year, the interest credited to the account is added to taxable income every month. That's why you can get a credit on an early redemption penalty on a CD - you were already taxed on that interest on the 1099-INT, so if you're giving the interest back, you get a credit on the 1099-INT for the interest you lost.

I Bond interest taxation is deferred until the time of redemption. So even though you do 'lose' three months if you redeem before the five-year mark, you were never taxed on that interest in the first place, and there is no reason to credit you for reversal of taxable income. The three months of taxable income just never makes it to the 1099-INT in the first place.

(Yes, I Bonds do trigger a 1099-INT at the end of the year if redeemed in a given TreasuryDirect account.)
And for those redeeming paper I Bonds at their local bank, the redeeming bank will issue the 1099-INT (some do at the time of redemption and others at the end of the year).
Best Regards - Mel | | Semper Fi
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by bogswenbern »

09deaconX wrote: Tue Jan 04, 2022 9:02 am So, shame on me for waiting until New Year's Eve, but on 12/31 I finally pulled the trigger on purchasing I Bonds. That said, when I look at the transaction history on my account I see the following:

Purchase Requested: 12/31/2021
Security Issued: 1/3/2022

I'm assuming that this means that my purchase counts towards my 2022 Calendar Year Limits, and not 2021? This seems like a straightforward question but I was having trouble finding an answer online (on the TreasuryDirect site or here). If so, I'll take it as a small "dumb tax" for not being more pro-active in figuring out what I wanted to do here.

Thanks in advance for anyone who can confirm!
Did you get an answer? I tried to email TD but got no response. My hope is that Purchase Requested is what counts, kind of like trade date for everything else we buy but who knows. At the minimum, they should realize that there is no clarity in their FAQ and allow another 2022 investment.
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Re: why is my ibond rate only 3.54 vs 7.12 for an old purchase

Post by GerryL »

dukeblue219 wrote: Tue Jan 04, 2022 12:06 pm
relampago wrote: Tue Jan 04, 2022 12:04 pm A number of years ago I purchased ibonds and never looked at them until recently. Why are all but this one 3.54?


Issue Date Interest Rate Status Amount Current Value
11-01-2021 7.12% $10,000.00 $10,000.00
12-01-2014 7.12% $10,000.00 $11,368.00
05-01-2013 7.12% $5,000.00 $5,842.00
04-01-2013 3.54% $5,000.00 $5,768.00
12-01-2012 7.12% $5,000.00 $5,854.00
12-01-2012 7.12% $5,000.00 $5,854.00
That bond updates every April and October. Last October the rate was 3.54. In April, it will bump up to 7.12 and stay there for 6 months.
Back in 2000 and 2001, I bought several bunches of $500 I bonds. (I am still holding the paper bonds.) Late in 2021, I checked the values and was gobsmacked to see the 7% interest rate on all of the bonds. Well, I just logged in again to check the current value of my stash of bonds and was gobsmacked again. The bunch of bonds purchased in January 2000 are now earning 10.64%.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by ACA »

Can a purchased I bond in one’s account be moved to the gift box and gifted to a spouse?
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by evelynmanley »

I Bonds: A very simple buying guide for 2022
Posted on January 4, 2022 by Tipswatch

See this as a short-term investment? Buy late in the month of January. Long-term investment? Buy anytime from January to April.

By David Enna, Tipswatch.com


https://tipswatch.com/2022/01/04/i-bond ... -for-2022/
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HueyLD »

ACA wrote: Tue Jan 04, 2022 7:35 pm Can a purchased I bond in one’s account be moved to the gift box and gifted to a spouse?
You can transfer the I bonds in your TD account to your spouse’s TD account provided that the spouse is at least 18 years old.

And such a transfer is a taxable event, meaning that you will pay all accrued taxes on cumulative interest if you have not chosen the “pay as you go” option.

The reason for tax due is to prevent those in high tax brackets from shifting income to low tax bracket recipients.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by ACA »

HueyLD wrote: Wed Jan 05, 2022 9:29 am
ACA wrote: Tue Jan 04, 2022 7:35 pm Can a purchased I bond in one’s account be moved to the gift box and gifted to a spouse?
You can transfer the I bonds in your TD account to your spouse’s TD account provided that the spouse is at least 18 years old.

And such a transfer is a taxable event, meaning that you will pay all accrued taxes on cumulative interest if you have not chosen the “pay as you go” option.

The reason for tax due is to prevent those in high tax brackets from shifting income to low tax bracket recipients.
Thank you.
If this is done, does the transfer count toward the calendar year $10k limit? Can it be done before I bond is held for one year?
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HueyLD
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by HueyLD »

Yes, the transfer counts toward recipient’s purchase limit.

You can transfer an I bond five business days after your purchase date.

And you may be required to fill out Form 5511 with signature certification requirement.

https://treasurydirect.gov/pdf/rs/PDF5511.pdf

Also: “ Are EE and I Bonds transferable?

Yes. The owner can transfer EE and I Bonds to another person with a TreasuryDirect account; however, you must wait five business days after the purchase date to transfer the bonds.

Are there any fees for transferring EE and I Bonds?

No. We don't charge any fees for transferring EE and I Bonds.

How do I transfer a savings bond?

A savings bond may be transferred either in full or in part to another TreasuryDirect account. See How do I transfer savings bonds from my TreasuryDirect account to another TreasuryDirect account?.”

https://www.treasurydirect.gov/indiv/he ... Securities


If I transfer savings bonds to another TreasuryDirect customer, how does it affect the recipient's purchase limitation?

If you transfer savings bonds to another customer, the amount of the transfer is applied toward the annual purchase limitation for each savings bond type in the year the transfer occurs.”
Johnny Thinwallet
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Johnny Thinwallet »

For those smarter than me ...

What's the new CPI index at, and do we have a new "minimum floor" for the May 1 rate based on the last 3 months of data? I thought I've read that the floor was 2.66% based on the Oct/Nov readings. I'm assuming that floor is now in the 3-4% range?
wwsdt
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by wwsdt »

There technically isn't a minimum floor because deflation is always a possibility.
BrokerageZelda
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by BrokerageZelda »

Johnny Thinwallet wrote: Wed Jan 12, 2022 8:55 am For those smarter than me ...

What's the new CPI index at, and do we have a new "minimum floor" for the May 1 rate based on the last 3 months of data? I thought I've read that the floor was 2.66% based on the Oct/Nov readings. I'm assuming that floor is now in the 3-4% range?
The "December 2021" non-seasonally-adjusted CPI-U number from this morning is 278.802. Comparing that to the 'starting point' CPI-U from "September 2021" of 274.310, the raw increase is approximately 1.638%. The next 'I Bond equivalent rate' if inflation were completely flat for the next three months would be double that rounded to two decimal places, or 3.27%.

There is no "minimum floor" beyond 0.00%; it's always possible that we could have massive deflation over the next three months that wipes out the last three months of positive inflation. However, if you believe inflation will only go up for the next three months, 3.27% is your answer.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Johnny Thinwallet »

BrokerageZelda wrote: Wed Jan 12, 2022 9:04 am
Johnny Thinwallet wrote: Wed Jan 12, 2022 8:55 am For those smarter than me ...

What's the new CPI index at, and do we have a new "minimum floor" for the May 1 rate based on the last 3 months of data? I thought I've read that the floor was 2.66% based on the Oct/Nov readings. I'm assuming that floor is now in the 3-4% range?
The "December 2021" non-seasonally-adjusted CPI-U number from this morning is 278.802. Comparing that to the 'starting point' CPI-U from "September 2021" of 274.310, the raw increase is approximately 1.638%. The next 'I Bond equivalent rate' if inflation were completely flat for the next three months would be double that rounded to two decimal places, or 3.27%.

There is no "minimum floor" beyond 0.00%; it's always possible that we could have massive deflation over the next three months that wipes out the last three months of positive inflation. However, if you believe inflation will only go up for the next three months, 3.27% is your answer.
Thanks for the detailed explanation! And for the correction on a minimum floor. Always learning something new on here.

:sharebeer
GuySmiley
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by GuySmiley »

For the first time I accidentally 8-) bought a 2nd 10K of I Bonds in the waning days of 2021. They sent me a mail stating the overcontribution would be refunded to my bank account, but that was over two weeks ago and it hasn't happened yet. In the meantime, the contribution shows up in TD as I Bonds. I'm curious if others have gotten overcontribution refunds and how long it took. I'm hoping they just accidentally sent the wrong email and intended to grant me a one-time pass and say don't do it again.
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tipswatcher
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by tipswatcher »

GuySmiley wrote: Wed Jan 12, 2022 7:14 pm For the first time I accidentally 8-) bought a 2nd 10K of I Bonds in the waning days of 2021. They sent me a mail stating the overcontribution would be refunded to my bank account, but that was over two weeks ago and it hasn't happened yet. In the meantime, the contribution shows up in TD as I Bonds. I'm curious if others have gotten overcontribution refunds and how long it took. I'm hoping they just accidentally sent the wrong email and intended to grant me a one-time pass and say don't do it again.
I did this one time, many years ago, with a registration that changed spouses. It was a legit error. TD gave me a pass on that one. I am figuring this year, though, they won't be so kind, since this could be rampantly be abused, given the high appeal of I Bonds.
TIPS: Perfect investment for imperfect times?
loukycpa
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by loukycpa »

I think the tax advantages of I bonds (and EE bonds) aren't emphasized enough. Increasing your tax deferred space can be a big win. I can't control what the market gives me, but I can control my tax burden to a large extent.

The front load gift strategy has enabled me to get a respectable chunk of the bond side of my portfolio into I bonds. Most of my taxable space is now in either I bonds with some additional in EE bonds. Equities and total bond funds are all in either tax deferred (401k or traditional IRA) or tax free (Roth).

The win here as I see it is that I will never have to pay taxes in retirement on money I'm not spending. Like ever. Ok, not totally true. I'll strategically do some Roth conversions I'm sure. But other than those ROTH conversions (which again I control also), low spenders like me can keep their taxes very low. 0% tax rate is possible, even with a large portfolio, especially after you get a decent portion of your IRA/401K money converted to Roth.
"The safe assumption for an investor is that over the next hundred years, the currency is going to zero." - Charlie Munger
protagonist
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by protagonist »

Mel Lindauer wrote: Tue Jan 04, 2022 11:47 am
BrokerageZelda wrote: Sat Jan 01, 2022 11:43 am
NewbieBogle007 wrote: Sat Jan 01, 2022 11:35 am Any tips on timing when to buy for this year?
Here are my thoughts from an earlier post:
viewtopic.php?p=6404091#p6404091

My answer in short: if you can afford to and want to max out, do it in late January. The fixed rate is unlikely to rise anytime soon, and I want to lock in the way-above-average inflation rate for 6 months and have the money accessible again (run out the 12 month clock) as soon as possible.
This is good advice and the same thing I would have posted had BrokerageZelda not already done so.
Yes, very good advice. Though if you are getting less than 1% on your cash, and especially if you are getting next to nothing, it might not be worth the effort to wait until late in the month....the interest you will lose by buying now is pretty trivial.
Intrepyd
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Intrepyd »

Does the 3 month interest redemption penalty subtract the first 3 months of interest, or the most recent 3 months of interest?

The behavior of making interest accrual invisible for the first 3 months suggests that it’s that first 3 months of interest. But, that treatment seems less intuitive to me.
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Mel Lindauer
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

Intrepyd wrote: Sun Jan 16, 2022 4:31 pm Does the 3 month interest redemption penalty subtract the first 3 months of interest, or the most recent 3 months of interest?

The behavior of making interest accrual invisible for the first 3 months suggests that it’s that first 3 months of interest. But, that treatment seems less intuitive to me.
No, it's the last three months.

The reason for making the interest accrual invisible for the first 3 months is because the first three months are also the last three months.
Best Regards - Mel | | Semper Fi
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Mel Lindauer
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

protagonist wrote: Sun Jan 16, 2022 4:11 pm
Mel Lindauer wrote: Tue Jan 04, 2022 11:47 am
BrokerageZelda wrote: Sat Jan 01, 2022 11:43 am
NewbieBogle007 wrote: Sat Jan 01, 2022 11:35 am Any tips on timing when to buy for this year?
Here are my thoughts from an earlier post:
viewtopic.php?p=6404091#p6404091

My answer in short: if you can afford to and want to max out, do it in late January. The fixed rate is unlikely to rise anytime soon, and I want to lock in the way-above-average inflation rate for 6 months and have the money accessible again (run out the 12 month clock) as soon as possible.
This is good advice and the same thing I would have posted had BrokerageZelda not already done so.
Yes, very good advice. Though if you are getting less than 1% on your cash, and especially if you are getting next to nothing, it might not be worth the effort to wait until late in the month....the interest you will lose by buying now is pretty trivial.
Agree, but it's a good habit to get into since interest rates will rise to levels that will make it more worthwhile. Remember the days of 15% interest? I do.
Best Regards - Mel | | Semper Fi
calwatch
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by calwatch »

I don't think it has been mentioned in the mega thread, but since I read it in an IRS publication, you can switch back and forth from paying interest on withdrawal/maturity and paying interest every year, without much hassle from the IRS. You will need to keep your own accounting to avoid double paying for taxes, but this is a possible alternative/supplement to Roth conversions for those in low income years, or for those in states or localities with income taxes (since I bonds are state tax free).

Reporting options for cash method taxpayers. If you use the cash method of reporting income, you can report the interest on Series EE, Series E, and Series I bonds in either of the following ways.
Method 1. Postpone reporting the interest until the earlier of the year you cash or dispose of the bonds or the year in which they mature. (However, see Savings bonds traded , later.)
Note. Series EE bonds issued in 1990 matured in 2020. If you have used method 1, you generally must report the interest on these bonds on your 2020 return. The last Series E bonds were issued in 1980 and matured in 2010. If you used method 1, you generally should have reported the interest on these bonds on your 2010 return.
Method 2. Choose to report the increase in redemption value as interest each year.

You must use the same method for all Series EE, Series E, and Series I bonds you own. If you do not choose method 2 by reporting the increase in redemption value as interest each year, you must use method 1.
.
If you plan to cash your bonds in the same year you will pay for higher education expenses, you may want to use method 1 because you may be able to exclude the interest from your income. To learn how, see Education Savings Bond Program, later.
.

Change from method 1. If you want to change your method of reporting the interest from method 1 to method 2, you can do so without permission from the IRS. In the year of change, you must report all interest accrued to date and not previously reported for all your bonds.
Once you choose to report the interest each year, you must continue to do so for all Series EE, Series E, and Series I bonds you own and for any you get later, unless you request permission to change, as explained next.

Change from method 2. To change from method 2 to method 1, you must request permission from the IRS. Permission for the change is automatically granted if you send the IRS a statement that meets all the following requirements.
You have typed or printed the following number at the top: "131."
It includes your name and social security number under "131."
It includes the year of change (both the beginning and ending dates).
It identifies the savings bonds for which you are requesting this change.
It includes your agreement to:
Report all interest on any bonds acquired during or after the year of change when the interest is realized upon disposition, redemption, or final maturity, whichever is earliest; and
Report all interest on the bonds acquired before the year of change when the interest is realized upon disposition, redemption, or final maturity, whichever is earliest, with the exception of the interest reported in prior tax years.
You must attach this statement to your tax return for the year of change, which you must file by the due date (including extensions).

You can have an automatic extension of 6 months from the due date of your return for the year of change (excluding extensions) to file the statement with an amended return. On the statement, type or print "Filed pursuant to section 301.9100-2." To get this extension, you must have filed your original return for the year of the change by the due date (including extensions). See also Revenue Procedure 2015-13, Section 6.03(4).

Instead of filing this statement, you can request permission to change from method 2 to method 1 by filing Form 3115. In that case, follow the form instructions for an automatic change. No user fee is required.


https://www.irs.gov/publications/p550#e ... nk10009907
comeinvest
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by comeinvest »

calwatch wrote: Wed Jan 19, 2022 12:25 pm I don't think it has been mentioned in the mega thread, but since I read it in an IRS publication, you can switch back and forth from paying interest on withdrawal/maturity and paying interest every year, without much hassle from the IRS. You will need to keep your own accounting to avoid double paying for taxes, but this is a possible alternative/supplement to Roth conversions for those in low income years, or for those in states or localities with income taxes (since I bonds are state tax free).
Quite useful to know, thanks!
protagonist
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by protagonist »

Mel Lindauer wrote: Sun Jan 16, 2022 4:43 pm
protagonist wrote: Sun Jan 16, 2022 4:11 pm
Mel Lindauer wrote: Tue Jan 04, 2022 11:47 am
BrokerageZelda wrote: Sat Jan 01, 2022 11:43 am
NewbieBogle007 wrote: Sat Jan 01, 2022 11:35 am Any tips on timing when to buy for this year?
Here are my thoughts from an earlier post:
viewtopic.php?p=6404091#p6404091

My answer in short: if you can afford to and want to max out, do it in late January. The fixed rate is unlikely to rise anytime soon, and I want to lock in the way-above-average inflation rate for 6 months and have the money accessible again (run out the 12 month clock) as soon as possible.
This is good advice and the same thing I would have posted had BrokerageZelda not already done so.
Yes, very good advice. Though if you are getting less than 1% on your cash, and especially if you are getting next to nothing, it might not be worth the effort to wait until late in the month....the interest you will lose by buying now is pretty trivial.
Agree, but it's a good habit to get into since interest rates will rise to levels that will make it more worthwhile. Remember the days of 15% interest? I do.
+1. I bought mine already....but that is mainly because I know my weaknesses, and I don't want to risk "spacing out" and forgetting to do so on the 30th or 31st.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by Mel Lindauer »

protagonist wrote: Thu Jan 20, 2022 11:31 am
Mel Lindauer wrote: Sun Jan 16, 2022 4:43 pm
protagonist wrote: Sun Jan 16, 2022 4:11 pm
Mel Lindauer wrote: Tue Jan 04, 2022 11:47 am
BrokerageZelda wrote: Sat Jan 01, 2022 11:43 am

Here are my thoughts from an earlier post:
viewtopic.php?p=6404091#p6404091

My answer in short: if you can afford to and want to max out, do it in late January. The fixed rate is unlikely to rise anytime soon, and I want to lock in the way-above-average inflation rate for 6 months and have the money accessible again (run out the 12 month clock) as soon as possible.
This is good advice and the same thing I would have posted had BrokerageZelda not already done so.
Yes, very good advice. Though if you are getting less than 1% on your cash, and especially if you are getting next to nothing, it might not be worth the effort to wait until late in the month....the interest you will lose by buying now is pretty trivial.
Agree, but it's a good habit to get into since interest rates will rise to levels that will make it more worthwhile. Remember the days of 15% interest? I do.
+1. I bought mine already....but that is mainly because I know my weaknesses, and I don't want to risk "spacing out" and forgetting to do so on the 30th or 31st.
Good for you. This not only gets you the nice current 7.12%, but it also gets the clock running on your one-year lockup.
Best Regards - Mel | | Semper Fi
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by stoptothink »

tipswatcher wrote: Wed Jan 12, 2022 7:27 pm
GuySmiley wrote: Wed Jan 12, 2022 7:14 pm For the first time I accidentally 8-) bought a 2nd 10K of I Bonds in the waning days of 2021. They sent me a mail stating the overcontribution would be refunded to my bank account, but that was over two weeks ago and it hasn't happened yet. In the meantime, the contribution shows up in TD as I Bonds. I'm curious if others have gotten overcontribution refunds and how long it took. I'm hoping they just accidentally sent the wrong email and intended to grant me a one-time pass and say don't do it again.
I did this one time, many years ago, with a registration that changed spouses. It was a legit error. TD gave me a pass on that one. I am figuring this year, though, they won't be so kind, since this could be rampantly be abused, given the high appeal of I Bonds.
I'm in the same situation. I set up a recurring contribution and then got a larger than expected end-of-year bonus so decided to lump sum the first of the year. I could not figure out how to cancel the recurring contribution. Well, they pulled money from my checking account the 5th (I think) and I immediately got an email saying I made an overcontribution and that they would be pushing the contribution back into my checking account. I did figure out how to cancel the recurring contribution, but ~2 weeks and no sign of the excess contribution. I wouldn't mind them allowing a one-time overcontribution, but I do want some resolution; another week and I am calling or emailing. TD might have the least user friendly website I've ever seen.
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Re: I Bonds Mega Thread (I Bond Heads Rejoice!)

Post by protagonist »

Mel Lindauer wrote: Thu Jan 20, 2022 6:57 pm
protagonist wrote: Thu Jan 20, 2022 11:31 am
Mel Lindauer wrote: Sun Jan 16, 2022 4:43 pm
protagonist wrote: Sun Jan 16, 2022 4:11 pm
Mel Lindauer wrote: Tue Jan 04, 2022 11:47 am

This is good advice and the same thing I would have posted had BrokerageZelda not already done so.
Yes, very good advice. Though if you are getting less than 1% on your cash, and especially if you are getting next to nothing, it might not be worth the effort to wait until late in the month....the interest you will lose by buying now is pretty trivial.
Agree, but it's a good habit to get into since interest rates will rise to levels that will make it more worthwhile. Remember the days of 15% interest? I do.
+1. I bought mine already....but that is mainly because I know my weaknesses, and I don't want to risk "spacing out" and forgetting to do so on the 30th or 31st.
Good for you. This not only gets you the nice current 7.12%, but it also gets the clock running on your one-year lockup.
I hadn't thought of that, but given that I am pushing 70, that's probably not a bad idea, Mel! *giggle*
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