Series EE Savings Bonds

Series EE savings bonds, ranging in denominations of $50 to $10,000, is a good option for the investor who wants to safely store his money or save for a child's tuition. These bonds are only subject to federal income tax after they have matured, and if you have chosen to use them to pay for tuition, you may be able to eliminate paying the tax on interest. The government purchases the bonds upon maturation and pays the full face value, whereas you buy them originally at a discounted value.

Series EE savings bonds produce a minimum return that matches that of five-year Treasury securities.

What Separates Series EE Savings Bonds from Zero-coupon Bonds?
• Zero-coupon Bonds - You pay taxes on imputed interest, which is not applied until the bonds reach the peak of its maturation stage.

• Series EE Savings Bonds - You pay the federal income tax upon withdrawal and potentially avoid all local and state taxes.

This information is presented to educate the reader and does not constitute professional tax and legal advice.

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