Spencer Law Firm LLC
717.207.7935 866.639.5451

June 2010 Archives

Savings Bonds - Part 2 Purchase and Ownership

Savings Bonds are registered securities. They cannot be sold to anyone other than the U.S. Treasury and its agent banks. They are not marketable. Some of the consequences that follow from this status is that they can't be used a collateral for a loan and they can't be given to anyone without re-registering them. Savings bonds are also non-callable, that is, the U.S. Treasury can't force you to redeem the bonds before they stop paying interest at final maturity. Savings bonds are a completely "no-load" investment. There are never any fees for buying, selling or holding savings bonds.

Income Taxation of Savings Bonds

U.S. Savings Bonds were created to finance World War I. They were originally called Liberty Bonds. Because U.S. Savings Bonds are issued by the federal government, you do not have to pay state tax or local tax on the interest. Two types of savings bonds that are still available are Series EE and Series I bonds.

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Spencer Law Firm LLC
320 Race Ave
Lancaster, PA 17603

Toll Free: 866-639-5451
Phone: 717-207-7935
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