The two ways to give savings bonds as gifts

You can buy U.S. savings bonds as gifts in two forms: paper bonds (Series I and EE) through TreasuryDirect, or digital bonds (Series I and EE) also through TreasuryDirect. Paper bonds arrive by mail and the recipient can hold them physically. Digital bonds exist only in the TreasuryDirect account and must be registered to the recipient's Social Security number from the start.

Paper bonds are the traditional gift option — you buy them, they arrive in an envelope, and you hand them over. Digital bonds are faster to purchase and arrive instantly in the recipient's account, but they require you to set up the account in their name, which means you need their Social Security number and their permission beforehand.

Both types work the same way once owned: they earn interest, cannot be cashed in for the first year, and have a 30-year maturity period. The choice between paper and digital depends on whether you want a physical object to give or an account-based investment.

Key Takeaways

  • Paper bonds are purchased through TreasuryDirect and mailed to you; you then give them to the recipient as a physical gift.
  • Digital bonds are purchased through TreasuryDirect and registered directly to the recipient's account, requiring their Social Security number and permission.
  • You must have a TreasuryDirect account to buy bonds as gifts, whether paper or digital.
  • Paper bonds cannot be cashed in during the first year; digital bonds have the same restriction once registered to the recipient.
  • The recipient can manage digital bonds through their own TreasuryDirect account, while paper bonds must be surrendered to the Treasury to cash in.

Buying paper bonds to give as physical gifts

To buy paper Series I or EE bonds as gifts, log into your TreasuryDirect account and select "Buy Bonds." Choose "Paper Bonds" and the denomination you want (Series I and EE paper bonds come in amounts from $50 to $10,000). Complete the purchase, and the bonds will be printed and mailed to your address within two to four weeks.

When the bonds arrive, they are registered in your name as the purchaser. You can then give them to the recipient as a gift. The recipient does not need a TreasuryDirect account to receive or hold paper bonds — they simply keep the physical certificate. If they want to cash the bonds in later, they will need to present them to a bank or the Treasury, along with identification.

Paper bonds are popular as gifts because they feel tangible and can be presented in a card or envelope. However, the two- to four-week delivery time means you cannot buy them last-minute. If you want to give a bond immediately, a digital bond or a gift card to TreasuryDirect may work better.

Setting up digital bonds in the recipient's name

Digital bonds must be registered to the recipient's Social Security number and TreasuryDirect account from the moment of purchase. This means you cannot buy a digital bond in your name and transfer it later — the account setup happens first.

To purchase a digital bond as a gift, you will need the recipient's full name, Social Security number, date of birth, and email address. You then create a TreasuryDirect account in their name (or they create one themselves and give you the details). Once the account exists, you can buy Series I or EE digital bonds and direct them into that account. The bonds appear instantly in the recipient's TreasuryDirect dashboard.

The recipient can then manage the bonds themselves — checking the current value, setting up redemption instructions, or leaving them to mature. They will need their own login credentials to access the account, so make sure they have those before you complete the purchase.

What you need before you buy

You must have your own TreasuryDirect account to buy any bonds, whether for yourself or as gifts. If you do not have one, you can create it at TreasuryDirect.gov using your Social Security number, email address, and a U.S. bank account for funding. The account setup takes about 15 minutes.

For paper bonds, you only need your own account information. For digital bonds, you also need the recipient's Social Security number, full name, date of birth, and email address. If the recipient is a minor, you will need their Social Security number and date of birth, but the account can still be opened in their name.

You will also need a way to fund the purchase — a U.S. bank account linked to TreasuryDirect. You cannot buy bonds with a credit card or debit card through TreasuryDirect; the money must come from a checking or savings account.

Minimum and maximum purchase amounts

Series I and EE bonds have different purchase rules. You can buy paper bonds in denominations of $50, $75, $100, $200, $500, $1,000, $5,000, or $10,000. Digital bonds have no set denominations — you choose the exact dollar amount you want to invest, from $25 up to $10,000 per bond.

There is an annual purchase limit: you can buy up to $10,000 in digital Series I bonds and up to $10,000 in digital Series EE bonds per calendar year, per person. Paper bonds have a separate $5,000 annual limit per person. These limits apply to bonds you buy for yourself; if you are buying bonds as gifts in someone else's name, those count toward their limit, not yours.

If you want to give more than the annual limit, you can buy bonds in different calendar years, or the recipient can buy additional bonds themselves once they turn 18 (or you can buy them on behalf of a minor up to the limit).

Tax considerations for bond gifts

Savings bonds are not subject to state or local income tax, but they are subject to federal income tax. The person who owns the bond — the person whose name is on the certificate or account — is responsible for reporting the interest earned when they file taxes.

For paper bonds you give as gifts, the recipient becomes the owner and will owe federal tax on the interest. For digital bonds registered to the recipient's account, they are the owner from day one and will owe tax on the interest.

There is no federal gift tax on savings bonds under $18,000 per recipient per year (as of 2024, though this amount changes annually). Bonds are not considered income to the recipient — only the interest earned is taxable, and only when the bond is cashed in or reaches final maturity.

Redeeming bonds that were given as gifts

Paper bonds cannot be cashed in during the first year of ownership. After one year, they can be redeemed at most banks or directly through the Treasury, but the recipient will receive a lower value if they cash in before five years have passed. After five years, the full value plus all accrued interest is available.

Digital bonds work the same way: they cannot be redeemed in the first year, and early redemption before five years results in a penalty (the loss of the last three months of interest). After five years, the full value is available with no penalty.

To redeem a paper bond, the recipient takes it to a bank or mails it to the Treasury with a form. To redeem a digital bond, the recipient logs into their TreasuryDirect account and requests redemption — the money is deposited into their linked bank account within a few business days.

Frequently Asked Questions

Can I buy a savings bond as a gift if I do not have a TreasuryDirect account?

No. You must have your own TreasuryDirect account to purchase any bonds. You can create one at TreasuryDirect.gov in about 15 minutes using your Social Security number and a U.S. bank account.

What happens if I buy a paper bond but change my mind before giving it?

Paper bonds cannot be returned or exchanged once issued. If you want to cancel the purchase, you would need to contact TreasuryDirect customer service, but they may not reverse the transaction. It is best to be certain before you buy.

Do I need the recipient's permission to buy them a digital bond?

Yes. Because a digital bond must be registered to the recipient's TreasuryDirect account and Social Security number, you need their permission and their account information beforehand. You cannot set up an account in someone else's name without their knowledge.

Can I buy a savings bond as a gift for someone who is under 18?

Yes. You can buy paper bonds and give them to a minor, or you can buy digital bonds registered to a minor's account (you will need their Social Security number and date of birth). The minor cannot manage a digital account themselves until they turn 18, but the bonds will be in their name.

What is the difference between Series I and Series EE bonds as gifts?

Series I bonds earn interest tied to inflation, so the rate changes every six months. Series EE bonds earn a fixed rate set when you buy them. For gifts, Series I is better if you expect inflation; Series EE is better if you want a may provide rate. Both have the same redemption rules and tax treatment.