Where to cash your government bonds depends on the type and whether you bought them directly or through a bank

Treasury bonds, bills, and notes are cashed through TreasuryDirect (the U.S. Department of the Treasury's online platform) if you own them there, or through your bank or brokerage if you bought them elsewhere. Series EE and I savings bonds are cashed only through TreasuryDirect or a bank that participates in the Treasury Retail Securities Services program. The process takes a few business days and moves the money into your bank account.

The specific steps depend on where the bonds live right now. If you registered them in TreasuryDirect when you bought them, you log in and request a redemption. If a bank or broker holds them, you contact that institution and ask them to sell or redeem the bonds on your behalf. You cannot walk into a bank with a paper bond certificate and cash it the way you would a check — the Treasury stopped issuing paper bonds in 2002.

Key Takeaways

  • Treasury bonds held in TreasuryDirect are redeemed by logging into your account, selecting the bond, and requesting a redemption that deposits to your linked bank account within a few business days.
  • Bonds held at a bank, brokerage, or other financial institution must be sold or redeemed through that institution, which may charge a transaction fee.
  • Series EE and I savings bonds cannot be cashed until at least one year after purchase, and cashing before five years have passed means you lose the last three months of interest.
  • Treasury bonds sold before maturity may be worth more or less than you paid, depending on whether interest rates have risen or fallen since you bought them.
  • You will owe federal income tax on the interest earned, though not state or local tax, and the Treasury will report the earnings to the IRS.

Cashing bonds held in TreasuryDirect

Log into your TreasuryDirect account at treasurydirect.gov using your username and password. Navigate to "Manage My Securities" and select the bond you want to redeem. Click "Redeem" and confirm the transaction. The Treasury will process the redemption and deposit the money into the bank account you linked when you opened your TreasuryDirect account.

The deposit usually arrives within three to five business days. You do not need to contact anyone or fill out a separate form — the online request is the entire process. If you have forgotten your TreasuryDirect login, use the "Forgot Username" or "Forgot Password" link on the login page, or call the TreasuryDirect customer service line at 844-284-2676.

Cashing bonds held at a bank or brokerage

Contact the bank, brokerage, or financial institution where your bonds are registered. Tell them you want to redeem or sell the bonds and provide the bond identification numbers if you have them. The institution will process the transaction, which typically takes three to five business days, and deposit the proceeds into your account with them.

Some institutions charge a transaction fee for selling or redeeming bonds — this fee varies by provider and may range from nothing to $25 or more per transaction. Ask about the fee before you request the redemption. If the bonds are held in a brokerage account, selling them works the same way as selling any other security: the brokerage executes the sale on the secondary market, and you receive the current market price rather than the face value.

Understanding the difference between redemption and sale

Redemption means cashing the bond back to the Treasury at its face value (or maturity value) on or after the maturity date. This is what happens when you redeem a Series EE or I savings bond, or when you redeem a Treasury bond that has reached its maturity date. You get the full amount you are owed, no more and no less.

Sale means selling the bond to another investor before it matures, usually through a brokerage. The price you receive depends on the current market — if interest rates have risen since you bought the bond, the bond is worth less, and you will receive less than you paid. If interest rates have fallen, the bond is worth more, and you will receive more. This is why holding bonds to maturity protects you from interest rate risk.

Penalties and restrictions for cashing early

Series EE and I savings bonds have a one-year holding period: you cannot redeem them until at least one year after purchase. If you redeem before five years have passed, you lose the last three months of interest as a penalty. For example, if you redeem a Series I bond after three years, you receive the interest earned for two years and nine months, not three years.

Treasury bills, notes, and bonds have no early redemption penalty — you can sell them at any time on the secondary market. However, the price you receive will reflect the current interest rate environment. If you sell before maturity and interest rates have risen, you will receive less than you paid. If interest rates have fallen, you will receive more.

Tax consequences of cashing government bonds

Interest earned on all U.S. government bonds is subject to federal income tax. The Treasury will report the interest to the IRS on Form 1099-INT, and you must include it on your tax return for the year you redeem the bond. Interest is not subject to state or local income tax, which is one advantage of holding government bonds.

If you sell a Treasury bond before maturity at a price higher than you paid, you will also owe federal tax on the capital gain. If you sell at a loss, you may be able to deduct the loss on your tax return, but the rules are complex — consult a tax professional if this applies to you. For Series EE and I bonds, interest accrues each month but is not taxed until you redeem the bond, which can make them useful for deferring tax to a year when your income is lower.

What to do if you have lost or damaged bond documents

If your bonds are registered in TreasuryDirect, you do not have physical documents to lose — everything is electronic. Log into your account to see your holdings and redeem them. If you have forgotten which bonds you own or when they mature, your TreasuryDirect account shows all of this information.

If your bonds are held at a bank or brokerage and you have lost the statements or certificates, contact the institution directly. They have a record of your holdings in their system and can help you redeem them. Bring a form of identification when you visit in person, or verify your identity over the phone. If the bonds were issued before 2002 as paper certificates and you have lost the physical certificate, the process is more complex — contact the Treasury's Bureau of the Fiscal Service at 844-284-2676 for guidance.

Frequently Asked Questions

How long does it take to get the money after I redeem a bond?

Most redemptions deposit within three to five business days. TreasuryDirect redemptions are typically processed within this window. Banks and brokerages may take slightly longer depending on their internal processes. If more than five business days have passed, contact the institution holding the bonds to confirm the transaction went through.

Can I cash a bond before it matures?

Series EE and I savings bonds cannot be redeemed until one year after purchase. Treasury bills, notes, and bonds can be sold at any time, but you will receive the current market price, which may be less than you paid if interest rates have risen. Selling before maturity means you do not receive the full face value.

What if I do not remember where I bought my bonds?

If you think you own bonds but are not sure where they are, start by logging into TreasuryDirect at treasurydirect.gov. If you have an account there, your bonds will appear. If not, contact your bank or any brokerage where you have an account and ask them to search their records. You can also call the Treasury at 844-284-2676 for help locating bonds.

Do I owe taxes on the interest when I cash the bond?

Yes. Interest on government bonds is subject to federal income tax in the year you redeem the bond. The Treasury reports the interest to the IRS, and you must include it on your tax return. Interest is not subject to state or local tax. If you sold the bond before maturity and received more than you paid, you also owe tax on the capital gain.

What happens if I redeem a Series I bond before five years?

You lose the last three months of interest as a penalty. For example, redeeming after three years means you receive interest for two years and nine months. You can still redeem after one year, but the three-month penalty applies until the bond reaches five years old.