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Old 06-11-2022, 05:14 PM   #141
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Yes, I think it was Forgot Your Account Number link. Thanks for making that clear! I did reenter the information.


Ok. I tried that and got an error since I did not enter my drivers license number (which I did not do the first time) and it made me enter “none”. I did that and now it says I need to call. They are not open until Monday. Frustrating. This 10 minute process has grown.
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Old 06-12-2022, 09:13 AM   #142
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This thread is timely and informative for many who want I-Bonds in their portfolios, so let’s please stick to that topic. “Do I-Bonds belong in a portfolio?” is a legitimate topic but it needs its own thread, so the recent posts on that we’re carved out and are now a separate topic, here https://www.early-retirement.org/for...io-114310.html
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Old 06-12-2022, 10:00 AM   #143
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I've read the whole thread and now I have a question. I'm brand new at this, my first purchase happens on Monday.

Can I buy gifts for minor grandchildren? Do I use their SSNs when specifying a gift? Will they have any tax implications? It won't be the full $10,000 so I think not. We already have 529s for them and this would be separate, in addition to those.

Do I keep the gift in my account and give it at maturity? What else do I need to know?
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Old 06-12-2022, 10:12 AM   #144
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I've read the whole thread and now I have a question. I'm brand new at this, my first purchase happens on Monday.

Can I buy gifts for minor grandchildren? Do I use their SSNs when specifying a gift? Will they have any tax implications? It won't be the full $10,000 so I think not. We already have 529s for them and this would be separate, addition to those.

Do I keep the gift in my account and give it at maturity? What else do I need to know?
You will need their information, including SSN, to add them as a registrant for whom you are buying the gift. Make sure you check the box "this is a gift".

You can "deliver" the gift to them any time after 5 days from the day you purchased it (I believe they need to have their own Treasury Direct account to receive the gift, but others probably know more about that). You don't need to hold it in your gift box to maturity. The one year minimum holding period is triggered when you first buy the gift, regardless of whether you hold it in your gift box or deliver it to the grandchildren.

Any one person can only receive as a gift or buy for themselves $10k (face value) in I-Bonds in any one year. There are no gift tax considerations unless you go over $16k in gifts to any one non-spouse person in one year, so that shouldn't be an issue here.

The recipient can elect to pay income tax on the interest every year or defer it until the Bond is redeemed.
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Old 06-12-2022, 10:49 AM   #145
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Originally Posted by Sue J View Post
I've read the whole thread and now I have a question. I'm brand new at this, my first purchase happens on Monday.

Can I buy gifts for minor grandchildren? Do I use their SSNs when specifying a gift? Will they have any tax implications? It won't be the full $10,000 so I think not. We already have 529s for them and this would be separate, in addition to those.

Do I keep the gift in my account and give it at maturity? What else do I need to know?
Just thinking of the tax issues, and children, I think this is a great idea overall. I would consider keeping the gifts in the giftbox (your TD account giftbox) and actually gift it to them when they are older for a couple of reasons:
  • Gift it now, and when the kids are young, they cash out and blow it on candy/cars/etc.
  • If it's in their name, it could affect student grants/loans for college, but gifting them the bond once they are done College would boost their payoff's of debt if any and probably not interfere with their plans to buy I-bonds as new grads don't do that.
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Old 06-12-2022, 11:11 AM   #146
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You will need their information, including SSN, to add them as a registrant for whom you are buying the gift. Make sure you check the box "this is a gift".

You can "deliver" the gift to them any time after 5 days from the day you purchased it (I believe they need to have their own Treasury Direct account to receive the gift, but others probably know more about that). You don't need to hold it in your gift box to maturity. The one year minimum holding period is triggered when you first buy the gift, regardless of whether you hold it in your gift box or deliver it to the grandchildren.

Any one person can only receive as a gift or buy for themselves $10k (face value) in I-Bonds in any one year. There are no gift tax considerations unless you go over $16k in gifts to any one non-spouse person in one year, so that shouldn't be an issue here.

The recipient can elect to pay income tax on the interest every year or defer it until the Bond is redeemed.
I wanted to test out buying DW a gift of $10k on top of her own $10k. They do ask for her acct # to deliver it to. So far it seems to have worked.

Next, I'll try to do the same for my acct... From DW's acct.
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Old 06-12-2022, 11:15 AM   #147
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I wanted to test out buying DW a gift of $10k on top of her own $10k. They do ask for her acct # to deliver it to. So far it seems to have worked.

Next, I'll try to do the same for my acct... From DW's acct.
It might have worked temporarily but from the posts I have read you or her will soon be getting an email that she has exceeded the $10k allowance for 2022 and it will ultimately be returned.

Not sure how they will return it in your situation though. If you are lucky then they will just reverse your delivery of the gift to her and put it back into your gift box.
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Old 06-12-2022, 02:29 PM   #148
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^^^ Let's see... 9+% government guaranteed, full faith and credit is not a good investment... not someone that I would be taking investment advice from.
His thoughts at that time, around July 2021, the I bond interest rate was 3.54 for 6 months. I guess he didn't see the value in that.
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Old 06-12-2022, 03:58 PM   #149
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His thoughts at that time, around July 2021, the I bond interest rate was 3.54 for 6 months. I guess he didn't see the value in that.


Shows you how quickly inflation increased. I bought 10k last year because it was over 3.5%. In fact I wont be getting the current 9.6% rate from that purchase until starting in September.
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Old 06-12-2022, 04:58 PM   #150
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His thoughts at that time, around July 2021, the I bond interest rate was 3.54 for 6 months. I guess he didn't see the value in that.
So a guaranteed minimum of 1.77% for one-year wasn't good enough for him... I wonder what he was receiving at that time on his short-term money. IIRC on-line savings accounts were about 0.5% and one-year CDs were about 1%.
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Old 06-13-2022, 12:00 AM   #151
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Originally Posted by Surewhitey View Post
I wanted to test out buying DW a gift of $10k on top of her own $10k. They do ask for her acct # to deliver it to. So far it seems to have worked.

Next, I'll try to do the same for my acct... From DW's acct.
As long as you don't deliver it, you can buy as many gifts as you want. But the delivery counts towards a person's $10K limit.

This means gifts can only be dispensed at $10K per year, so DW and I bought for each other 3 years worth of gifts, each was $10K. These are sitting in the giftbox in our accounts waiting to be delivered in future years.
If we decided now to pull all the money out of Treasury direct, it would take 2023,2024, 2025, to accomplish it.
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Old 06-13-2022, 06:15 PM   #152
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OK, I finally got the I-Bonds purchase to work.

In DW's case it worked like SueJ mentioned above. That is, DW did not receive the email with her account number so she selected "forgot my account number", re-entered her information and then immediately got the email.

When I tried the same, it did not work for me and indicated that I needed to call. So, today I phoned and the automated message said there was a 2+ hour wait due to high call volume. I was at the 90 minute point on my hold and lo and behold, I receive the account number email. So, I hung up the phone and all is fine. I have no idea what pushed the email though. I wonder if there are people in the back office looking for these errors and manually pushing the emails through.

Anyway, we purchased our first $10k each today which should fund tomorrow. Assuming that works, we will then buy the $10k gift for each other as others are doing. I actually have an LLC, which I think would allow me to purchase another $10k. However, it is a pass through entity (schedule C) so I am not sure. I think to be safe, I will just stick with the $40k unless someone knows if a pass through LLC qualifies.

Thanks to all for all the information on I-bonds. I previously had no idea but these seem to be an unbelievable good deal right now. I only wished we could put more in.
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Old 06-13-2022, 07:36 PM   #153
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TIPS currently have real yields and no annual limits.
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Why Aren't I-Bonds Getting More Attention?
Old 06-15-2022, 03:05 AM   #154
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Why Aren't I-Bonds Getting More Attention?

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I actually have an LLC, which I think would allow me to purchase another $10k.
Yes it would. The Finance Buff blog has a thorough series of posts on the mechanics of I-bonds including “Buy I Bonds for Your Business.”
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Old 06-15-2022, 10:18 AM   #155
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.... However, it is a pass through entity (schedule C) so I am not sure. I think to be safe, I will just stick with the $40k unless someone knows if a pass through LLC qualifies.

....
Yes it qualifies, as an entity account. This also means it is basically limited to the $10K/yr and cannot have a beneficiary nor gift bonds.

As someone said, look at the website quoted above.
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Old 06-16-2022, 11:07 PM   #156
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Yep, absolutely no problem cashing them at my local savings and loan, and they do not do it often. Yep, started buying them in 2001. Wished I had several hundred thousand in them but getting there. Interesting how just one month's difference in purchase date can make a huge difference in the total value after compounding over a 20 plus year period. No state taxes, but the federal taxes can be challenging when cashing out. Whatever they were meant to be, they can serve as a moderating hedge against a declining equities market. They are what they are.
What is it that makes federal taxes a challenge when cashing out?

And how exactly do you cash out if you buy online?
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Old 06-17-2022, 04:50 AM   #157
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What is it that makes federal taxes a challenge when cashing out?

And how exactly do you cash out if you buy online?
Most people wait to report the interest when they cash a bond. (There is a way to do it year by year, but it can be complicated.) So, if someone has "several hundred thousand" in bonds and they cash them out, they likely have several 10 thousand in income. This can be a challenge for taxes because you might run into cliffs and inflection points.

If you buy online, you press a box ("REDEEM") and sell it. Savings Bonds can be sold through TD after certain requirements are met. Depends on the bond type, but usually requires holding it 1 year.

TIPS, Notes and Treasury Bonds are different and require transferring to a brokerage to sell.
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Old 06-22-2022, 10:26 AM   #158
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Beneficiary vs Joint Owner......

I bought an I Bond in my name. DH is also buying one in his name. I went to the Registration area of mine to add DH as my Beneficiary. Then I saw Primary owner with 2nd owner.

If I change mine to me as Primary and DH as secondary, does that affect him buying one in his own name? If he's my beneficiary that means after I die, where him as a 2nd owner means he could access if if I'm incapacitated.

Can we each have one with one of us as owner and the other as secondary - meaning one as Me+DH and the other as DH+me? Each one would be $10,000.

Or should I just stick with Beneficiary?
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Why Aren't I-Bonds Getting More Attention?
Old 06-22-2022, 10:39 AM   #159
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Why Aren't I-Bonds Getting More Attention?

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Beneficiary vs Joint Owner
Yes, you can hold bonds as You+DH and he can hold as DH+You. Naming someone as the second owner or beneficiary doesn’t affect their annual purchase limit. A second owner can be granted transaction rights but a beneficiary cannot transact. Here is an article describing the differences.
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Old 06-22-2022, 10:43 AM   #160
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Yes, you can hold bonds as You+DH and he can hold as DH+You. Naming someone as the second owner or beneficiary doesn’t affect their annual purchase limit. A second owner can be granted transaction rights but a beneficiary cannot transact. Here is an article describing the differences.

Thank you! Your link answered all my questions.
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