Cash method taxpayers. If you use the cash method of accounting, as most individual taxpayers do, you generally report the interest on U.S. savings bonds when you receive it. This means when they are cashed or redeemed. You do have the option of reporting the interest each year as it is earned, however it is not required.
The Form 1099-INT may not come until you actually cash the bonds because it will be issued by the bank where the bonds are cashed. As tagteam indicated, the bonds will no longer earn interest once they reach maturity.
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