Bonds are a capital gain item and are generally taxed as such.
In addition to how much you paid for the bonds ($0) and how much you sold them for (your check from the state), you will also need the date of purchase (I'd use the date you purchased the safe) and I'd use the date on the check for the date of the sale. If you try to report this as a traditional bond sale, the software will ask for information you are not likely to have and it will also ask for the accrued interest included in the proceeds. ("I found them" is not a choice for how you received your bonds.) I'd choose the category "Everything else" on the page "Choose the type of investment you sold."
- To enter this in your open Federal return, choose Wages and
Income (Personal
Income using Home and Business
- Scroll down to Investment
Income and Show more
- On Stocks,
Mutual Funds, Bonds, Other, click the start or update button
- Add your bond sale information.
