Found Matured EE Savings Bonds

[newyorknumber1]

We discovered $100K of EE Savings Bonds bought by mother-in-law for wife in 1986. We also found that she put them in wife's SSN. They matured 2016. We just found them and redeemed them at bank. Bank says they will be on a 2022 1099. How and when do we report the interest earned? If penalties are involved, how do we work with IRS to mitigate the penalties?

[AmeliesUncle]

The should be reported on the 2016 tax return.

Normally, the IRS can't assess tax for that long ago.  However, due to the amounts, they may be able to.  Due to the potential large penalties, I recommend you go to a good tax professional for this matter.