How do I input the interest earned on paper, series EE savings bonds that reached maturity in 2021 in TurboTax? I have not cashed them so I do not have a 1099-INT.

[PattiF · Accepted solution]

To report Bond interest, without form 1099-INT, enter it as if you had a 1099-INT form.

• Log on and continue your return then
• Press the TurboTax "Search" button near the top right of your screen
• Type "1099-int" into the TurboTax search box
• Select "Jump to 1099-int" from the dropdown list of results
• If you reach the "Here's the interest we have so far" screen, click "Add interest income"
• On the "Let Us Enter Your 1099-INT" screen, scroll down and press "I'll type it in myself"
• On the "Let's get the details from your 1099-INT or brokerage statement" screen, be sure to check the checkbox for "My form has info in more than just box 1 (this is uncommon)" See the screenshot below.
• You can now add Box 3 interest from your savings bonds.
• Follow the prompts
• If you reach the "Did you cash any Series EE or I U.S. savings bonds?" screen, press "Yes" if you did
• On the "Did you use your U.S. savings bonds to pay for higher education expenses?" screen, press "Yes" if you used your savings bonds for educational costs

You have a choice on when you report your bond interest. You can:

• report the interest every year or
• put off (defer) reporting the interest until you file a federal income tax return for the year in which the first of these events occurs:
  • you redeem (cash in) the bond and receive what the bond is worth, including the interest, or
  • you give up ownership of the bond and the bond is reissued, or
  • the bonds stops earning interest because it has reached final maturity.

[jasperj]

What do I put under Payers Information - Received from?

[FangxiaL]

Whether you have interest income from EE savings bond to report on your 2021 tax return depends on: 

• If you have electronic EE bonds in a TreasuryDirect account, they are automatically cashed and interest earned is reported to the IRS when the EE bonds stop earning interest (mature). In this case, you have interest income to report.
• If a financial institution pays the bond, you will receive a paper 1099-INT from that financial institution either soon after you cash your bonds or within the first two months after the end of the year in which you cash your bonds. If you have paper EE bonds, you report the interest income after you cash those bonds. 

You should cash the bonds and invest the money somewhere else. Interest has stopped accruing after it matures. 

@jasperj

[boulderkid]

I have a comparable EE savings bond situation, and could you please comment on the following:

I had some EE paper (not electronic) bonds that were never in a TreasuryDirect account. Bond interest was not claimed on any tax return during the bonds' 30 year life. The bonds matured in 2022, and were redeemed in person at a local bank last month (i.e., January 2023). Proceeds were deposited into an account at that bank. At the time of redemption, the bank provided a substitute Form 1099-INT for the redemption and it is dated the day of the redemption (Jan. 5, 2023). This is the only 1099-INT I will receive, according to the bank. Should the bond interest be claimed in the tax year the bonds matured (i.e., 2022) or the year of the redemption and dated 1099-INT (i.e., 2023)? Thanks in advance.

[PattiF]

The 1099-INT for the EE savings bonds would be reported in 2023 in the year that they were redeemed and the interest was received. Since the  substitute 1099-INT was issued by the bank for tax year 2023, the IRS will be expecting you to report the income in that year. 

[RH1234]

I had paper series EE bonds that I just cashed. They reached full maturity in 2022. I will not get the INT statement until 2023 (Jan of next year for 2023 taxes). Based on this answer below in a previous post - I am required to report the interest on my 2022 tax return - as I am obligated to pay the interest in the year the bonds matured. Correct? Since that happened first? I was going to submit the interest as if I had the statement - and then next year state that I already reported the same amount. 

You have a choice on when you report your bond interest. You can:

• report the interest every year or
• put off (defer) reporting the interest until you file a federal income tax return for the year in which the first of these events occurs:
  • you redeem (cash in) the bond and receive what the bond is worth, including the interest, or
  • you give up ownership of the bond and the bond is reissued, or
  • the bonds stops earning interest because it has reached final maturity.

[AmyC]

No, not when matured.  Your will report the year you cashed them in, 2023. The IRS says: 

Question

I cashed some Series E, Series EE, and Series I savings bonds. How do I report the interest?

Answer

In general, you must report the interest in income in the taxable year in which you redeemed the bonds to the extent you did not include the interest in income in a prior taxable year. 

@RH1234 

[RH1234]

ok but the publication further states the following (see below)- which is confusing and makes me believe that the interest needs to be reported in the year of maturity - which was 2022 not 2023 which is when i will get the INT statement.  

Series EE and Series I bonds.

 

Interest on these bonds is payable when you redeem the bonds. The difference between the purchase price and the redemption value is taxable interest.

Series E and EE bonds.

 

Series E bonds were issued before 1980. All Series E bonds have matured and are no longer earning interest. Series EE bonds were first offered in January 1980 and have a maturity period of 30 years; they were offered in paper (definitive) form until 2012. Paper Series EE and Series E bonds were issued at a discount and increase in value as they earn interest. Electronic (book-entry) Series EE bonds were first offered in 2003; they are issued at face value and increase in value as they earn interest. For all Series E and Series EE bonds, the purchase price plus all accrued interest is payable to you at redemption.

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.

1. 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. (
   Note. Series EE bonds issued in 1991 matured in 2021. If you have used method 1, you generally must report the interest on these bonds on your 2021 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.

2. Method 2. Choose to report the increase in redemption value as interest each year.

[RobertB4444]

You are correct about what the writing says, but if you follow it you're going to confuse the IRS.  

Since you're going to get the form for your 2023 taxes there is no point in reporting it on your 2022 taxes.  They'll try to match the forms to your 2023 return and they won't look at 2022.  You'll get a letter and have to respond with a copy of your 2022 return explaining everything.  

Just report it next year.

@RH1234