You can cash EE savings bonds at most banks, through the Treasury Department, or by mail — but the method depends on whether your bond is still earning interest

The simplest way to cash an EE savings bond is to walk into your bank with the bond and your ID. Most banks will cash them on the spot, though some may charge a small fee or require you to have an account there. If your bank won't cash it, the U.S. Treasury Department will cash it by mail or through their online portal if you have a TreasuryDirect account.

The catch is timing: EE bonds earn interest for 30 years, and if you cash one before it reaches final maturity, you'll lose the last month's interest. The Treasury holds back one month of earnings as a penalty for early redemption. You also owe federal income tax on all the interest you earned, though not state or local tax. If you cashed the bond before age 59½ and used it for anything other than education expenses, you may owe a 10 percent penalty on the interest portion — but that's rare and only applies in specific situations.

Key Takeaways

  • Banks are the fastest option for cashing EE bonds, but you'll lose one month of interest if the bond hasn't reached its 30-year maturity date.
  • The Treasury Department will cash bonds by mail or through TreasuryDirect if your bank refuses, though mail processing takes several weeks.
  • You owe federal income tax on all interest earned, and the Treasury will report the amount on a Form 1099-INT.
  • If you're under 59½ and cashing a bond for non-education purposes, a 10 percent penalty on interest may apply, but this is uncommon and depends on your situation.
  • Check your bond's issue date before cashing — if it's reached 30 years old, you stop earning interest and should cash it immediately.

Cashing at a bank or credit union

Bring the physical bond and a government-issued ID to any bank or credit union. The teller will verify the bond's authenticity, check that it hasn't been reported lost or stolen, and process the redemption. You'll receive a check or deposit to your account on the same day, usually within minutes.

Not all banks cash savings bonds — some only do it for account holders, and a few have stopped the service entirely. Call ahead or ask the teller before you wait in line. If they won't cash it, they can tell you which local banks do. Credit unions are often more flexible than large national banks on this.

The bank will not withhold taxes or report the transaction to the IRS. That's your responsibility. You'll need to report the interest on your tax return for the year you cashed the bond, even though you won't receive a 1099 form from the bank.

Redeeming through TreasuryDirect online

If you own the bond through a TreasuryDirect account (meaning you bought it online rather than in paper form), you can cash it directly through the website without visiting a bank. Log in, navigate to your holdings, and select the bond you want to redeem. The money will transfer to your linked bank account within one to three business days.

This option only works for electronic bonds purchased through TreasuryDirect.gov. If you have a paper bond, you cannot redeem it online — you'll need to use a bank or mail it to the Treasury.

Mailing bonds to the Treasury Department

If no bank will cash your bond and you don't have a TreasuryDirect account, you can mail the bond directly to the Bureau of the Fiscal Service. You'll need to fill out Form PD 1239 (Application for Payment of Savings Bond), include a photocopy of your ID, and mail both the form and the bond to the address listed on the form.

Processing takes four to six weeks. The Treasury will mail you a check to the address on file. This is the slowest option and carries a small risk of loss in the mail, so consider insuring the package if you use this method.

You can download Form PD 1239 from the Treasury's website or request it by phone. The form itself is straightforward — it asks for your name, address, Social Security number, and the bond's serial number and issue date.

Understanding the interest penalty and tax consequences

EE bonds earn interest monthly, but the Treasury only pays out interest in full-month increments. If you cash a bond before the next full month ends, you lose that month's interest. For example, if your bond earns $10 per month and you cash it on the 15th of a month, you forfeit the entire $10 for that month.

All interest you earned is subject to federal income tax in the year you cashed the bond. The amount depends on how long you held it — a bond held for 20 years will have earned far more interest than one held for 5 years. You report this on your tax return, and the IRS will expect you to pay tax on it.

A 10 percent penalty on the interest (not the principal) applies only if you're under 59½ and the bond was not used for may have access to education expenses. This is uncommon because most people either hold bonds until retirement or use them specifically for education. If you're unsure whether you may have access to for an exception, consult a tax professional before cashing.

What happens if your bond has reached final maturity

After 30 years, an EE bond stops earning interest. If you still own it, you're holding money that's no longer growing. Cash it as soon as you realize it's reached maturity — there's no benefit to waiting, and you're just leaving the money idle.

You can find your bond's issue date on the face of the bond itself. Count forward 30 years from that date. If you're past that date, redeem immediately. The interest you earned over those 30 years is final and won't change.

Replacing a lost or stolen EE bond

If you've lost a paper bond, contact the Treasury Department with the bond's serial number and issue date. They can place a stop on it to prevent anyone else from cashing it, and they'll issue a replacement. This process takes several weeks and requires documentation proving you owned the bond.

Keep copies of your bond purchase receipts or statements if you have them. If you bought the bond through a bank or employer savings plan, that institution may have records that help prove ownership.

Frequently Asked Questions

Do I have to pay taxes when I cash an EE bond?

Yes, you owe federal income tax on all the interest you earned, reported in the year you cashed the bond. You won't receive a 1099 form from the bank, so you'll need to calculate the interest yourself and report it on your tax return. State and local taxes do not apply to savings bond interest.

Can I cash someone else's EE bond?

Only if you're listed as the owner or co-owner on the bond. If the bond is in someone else's name only, you'll need a power of attorney or to be the executor of their estate. The bank or Treasury will ask for proof of your authority before processing the redemption.

What if my bank says they don't cash savings bonds anymore?

Ask them for a referral to a bank that does, or contact the Treasury Department directly. You can mail the bond with Form PD 1239, or open a TreasuryDirect account and transfer the bond there if it's electronic. The Treasury will always redeem bonds — it just may take longer than a bank.

Will I lose money if I cash my bond early?

You won't lose principal, but you'll forfeit one month of interest as a penalty for early redemption. If the bond is very new, this penalty might be larger than the interest earned so far. Check how much interest the bond has accumulated before deciding whether to cash it early.

How do I know how much interest my EE bond has earned?

The Treasury's Savings Bond Calculator on their website will tell you the current value of your bond if you enter the issue date and denomination. The difference between that value and what you paid is your interest. You can also call the Treasury or ask your bank to look it up.