You can cash savings bonds at a bank, through the Treasury Department, or by mail — the method depends on the bond type and how quickly you need the money

Savings bonds don't have a maturity date that forces you to act. You can hold them indefinitely, but when you decide to cash them in, your options are straightforward. Series EE and Series I bonds can be redeemed at most banks, credit unions, and through the U.S. Department of the Treasury's website. Series HH bonds (no longer sold) must be redeemed by mail through the Treasury. The process takes anywhere from a few minutes at a bank to several weeks by mail.

Before you cash a bond, understand that you'll owe federal income tax on the interest it earned — not on the original purchase price. If you bought a $50 bond for $25, you owe tax only on the difference. You can choose to report this interest on your tax return for the year you cash the bond, or you can report it annually as it accrues (though most people don't). State and local taxes do not apply to savings bond interest.

Key Takeaways

  • Banks and credit unions can cash Series EE and Series I bonds on the spot, but they may require you to have an account there.
  • You owe federal income tax on the interest your bond earned, but not on the original amount you paid for it.
  • The Treasury Department's TreasuryDirect website lets you redeem bonds online without visiting a bank, though the process takes a few business days.
  • Bonds held less than five years carry a penalty equal to three months of interest, so cashing early costs you money.
  • If you lose a bond or it's destroyed, the Treasury can issue a replacement, but you'll need proof of purchase and the bond's serial number.

Cashing bonds at a bank or credit union

This is the fastest way to get your money if you need it the same day. Walk into any bank or credit union with your bond and a valid ID. The teller will verify the bond's authenticity, check that it hasn't been reported lost or stolen, and give you the current redemption value. Most institutions complete this in minutes.

Some banks require you to have an account with them before they'll cash a bond. Call ahead to confirm their policy. Credit unions are often more flexible, especially if you're a member. If your bank refuses, try another bank in town — there's no rule saying you must use your own institution.

The bank will give you cash or deposit the money into your account. They won't withhold taxes; you'll handle that when you file your tax return. Keep the receipt they give you as proof of redemption.

Redeeming bonds through TreasuryDirect online

If you own your bonds through a TreasuryDirect account (the Treasury's online platform), you can redeem them without leaving home. Log into your account at treasurydirect.gov, select the bond you want to cash, and request redemption. The money goes directly to your linked bank account within one to three business days.

This method works only for bonds you bought through TreasuryDirect or transferred there from a paper bond. If you have a physical paper bond, you'll need to either take it to a bank or mail it to the Treasury. TreasuryDirect redemptions are free and don't require any paperwork beyond what you enter online.

Mailing bonds to the Treasury Department

If you have a paper bond and no bank will cash it, or if you prefer not to visit in person, you can mail it to the Treasury. Send the bond, a completed Form PD 1239 (Request for Redemption of Savings Bonds), and a copy of your ID to the address listed on the Treasury's website. Include a letter stating the bond's series, denomination, and serial number.

Processing takes four to six weeks. The Treasury will mail you a check or deposit the funds into your bank account if you provide account details. This method is slow but works for any bond type, including older Series HH bonds. Use certified mail with tracking so you have proof the package arrived.

Understanding the early redemption penalty

If you cash a Series EE or Series I bond before it has been held for five years, you lose three months of interest. A bond worth $1,000 that you redeem after three years might actually pay you $985 instead. This penalty exists to discourage early withdrawal and is built into the redemption value the bank or Treasury gives you.

Bonds held five years or longer have no penalty. After 30 years, Series EE bonds stop earning interest, so there's no reason to hold them past that point. Series I bonds earn interest for 30 years as well. Check your bond's issue date before you cash it — if you're close to the five-year mark, waiting a few months could save you money.

What happens if your bond is lost or destroyed

The Treasury can replace a lost, stolen, or damaged bond if you can prove you owned it. You'll need the bond's serial number, the issue date, the series, and proof of purchase (like a receipt or bank statement showing the purchase). Fill out Form PD 1048 (Claim for Lost, Stolen, or Destroyed Savings Bond) and mail it with your documentation.

The Treasury will investigate and, if satisfied, issue a replacement bond or pay you the redemption value. This process takes several months. If you can't find the serial number, the Treasury may still help if you can provide other identifying information, but it will take longer. Keep your bond purchase receipts in a safe place so you have this information if you need it.

Tax reporting when you redeem

When you cash a savings bond, you owe federal income tax on the interest it earned in the year you redeem it. The bank or Treasury won't send you a 1099 form automatically — you're responsible for reporting it. Add the interest amount to your other income on your tax return and pay tax at your ordinary income tax rate.

If you're in a lower tax bracket that year, you might benefit from waiting to redeem until a year when your income is lower. Conversely, if you're in a high-income year, you might want to spread redemptions across multiple years to avoid pushing yourself into a higher bracket. Talk to a tax professional if you're redeeming a large bond and want to plan the timing.

Frequently Asked Questions

Can I cash a savings bond that someone else gave me?

Yes, if the bond is registered in your name or is a bearer bond (older bonds with no name on them). If it's registered to someone else, that person must redeem it or sign it over to you in writing. Bring the bond and the signed authorization to a bank, along with both people's IDs.

What if I can't find my bond but remember buying it?

Contact the Treasury Department's Savings Bond Division. They can search their records using your Social Security number and the approximate purchase date. If they find it, they can help you redeem it or issue a replacement. This takes time, but it's possible even without the physical bond.

Do I have to cash the entire bond, or can I cash part of it?

You must redeem the entire bond. You cannot split a $1,000 bond and cash only half of it. If you need less money than the bond is worth, you'll receive the full redemption value and have to manage the extra funds yourself.

What if the bank says they won't cash my bond?

Banks can refuse to cash bonds they believe are counterfeit or improperly registered, but this is rare. If one bank refuses, try another. If multiple banks refuse, contact the Treasury Department directly — they can redeem any legitimate bond by mail or through TreasuryDirect.

Can I redeem a bond before its maturity date without a penalty?

Series EE and Series I bonds have no official maturity date, but they do have a five-year holding period. Redeem before five years and you lose three months of interest. After five years, you can redeem anytime with no penalty, though the bond continues earning interest for 30 years total.