You can cash Series EE bonds at most banks, credit unions, or directly through the U.S. Treasury

Series EE bonds can be cashed in at any point after you own them, though the Treasury charges a penalty if you cash them before five years have passed. The penalty is the loss of the last three months of interest — so if you cash a bond at year four, you lose the interest you would have earned in months 10, 11, and 12 of that year. After five years, you can cash them with no penalty.

You have three main routes: take the bond to a bank or credit union where you have an account, mail it to the Treasury, or use the Treasury's online system if the bond is registered in their system. The fastest route is usually your bank, which can process the redemption the same day. The online route is fastest if your bond is already digital.

Key Takeaways

  • Series EE bonds held for less than five years lose three months of interest when cashed, but bonds held five years or longer have no penalty.
  • Banks and credit unions can cash Series EE bonds the same day if you have an account there and bring the physical bond or proper identification.
  • The Treasury's online system (TreasuryDirect.gov) lets you redeem digital bonds without leaving home, though the money takes a few business days to arrive.
  • If you mail a physical bond to the Treasury, include a signed letter requesting redemption and allow two to three weeks for processing.
  • You will owe federal income tax on the interest earned, but not state or local tax, and you can choose to report it all at once or spread it across years.

Cashing a physical bond at your bank or credit union

Bring the bond itself and a form of identification to any bank or credit union where you have an account. The teller will verify that you are the registered owner (or the co-owner if the bond is registered to two people), check that the bond is genuine, and process the redemption. You will receive the full value plus any accrued interest, minus the three-month penalty if the bond is less than five years old.

Most banks complete this transaction on the spot and deposit the money into your account the same day. Some credit unions may take one business day. Call ahead if you want to confirm your branch handles bond redemptions — a few smaller institutions do not, though most do.

If you have lost the physical bond or it is damaged, bring what you have plus your identification. The bank can file a claim with the Treasury to verify ownership and issue a replacement, though this takes longer — usually two to four weeks.

Redeeming bonds online through TreasuryDirect

If your Series EE bond is registered in TreasuryDirect (the Treasury's online system), you can redeem it without visiting a bank. Log into your TreasuryDirect account at treasurydirect.gov, find the bond in your holdings, and select "Redeem." The system will show you the current value and any penalty. Confirm the redemption, and the money will be deposited into the bank account you have linked to your TreasuryDirect account.

The deposit usually arrives within three to five business days. This route works only if the bond was issued after 2003 and was registered in TreasuryDirect from the start — older paper bonds cannot be redeemed this way unless you first convert them to digital form, which requires a separate process.

If you do not have a TreasuryDirect account, you can create one for free at treasurydirect.gov. You will need a Social Security number, a valid email address, and a U.S. bank account to link for deposits.

Mailing a bond to the Treasury

If you prefer not to visit a bank or use the online system, you can mail the physical bond directly to the Treasury. Write a letter on plain paper stating your name, the bond's serial number, and that you request redemption. Sign the letter, enclose it with the bond, and mail both to the Treasury Retail Securities Site, Department of the Treasury, 200 Third Street, Parkersburg, WV 26106-1328.

Include a return address and consider using certified mail so you have proof of delivery. The Treasury will process the redemption and mail a check to you within two to three weeks. This route is slower than a bank visit but requires no account or online access.

Understanding the five-year holding period and interest penalty

Series EE bonds earn interest every month, but the Treasury penalizes early redemption by withholding the last three months of interest. This means if you cash a bond at year 2, you lose the interest from months 10, 11, and 12 of year 2. If you cash at year 5 or later, there is no penalty — you receive the full value plus all interest earned.

The penalty applies only to the interest, not to your original purchase price. If you bought a $100 bond and it has grown to $120 after three years, cashing it early means you receive $120 minus three months of interest (not $100 minus a percentage). The exact amount of the penalty depends on the bond's current value and the interest rate it has been earning.

If you are unsure whether a bond is past the five-year mark, check the issue date printed on the bond itself. Count forward five years from that date. If today's date is past that point, you can cash with no penalty.

Tax reporting and what you owe on the interest

The interest you earn on Series EE bonds is subject to federal income tax, but not to state or local tax. When you cash the bond, you will owe tax on all the interest that has accumulated since you bought it — not just the interest earned in the current year.

You have two choices for how to report this. You can report all the interest at once in the year you cash the bond, or you can report the interest year by year as it accrues (even though you have not cashed the bond yet). Most people choose to report it all at once when they redeem, which is simpler. The bank or Treasury will not send you a tax form automatically — you will need to calculate the interest yourself or contact the Treasury for the exact amount.

To find the interest earned, subtract your original purchase price from the current redemption value. If you bought a $100 bond and it is now worth $145, you owe tax on $45 of interest. Keep the redemption receipt for your records.

What happens if the bond is registered to two people

If a Series EE bond is registered to two owners, either owner can redeem it without the other's permission. Whoever redeems it receives the full value plus interest. The person who redeems is responsible for reporting the interest on their tax return — the other owner does not report anything.

If both owners want to split the proceeds, they will need to arrange that themselves after redemption. The Treasury does not split the payment between two accounts. If the bond is registered as "John Doe or Jane Doe," either can cash it alone. If it is registered as "John Doe and Jane Doe," either can still cash it alone, though some banks may ask for consent from both parties — call ahead to confirm your bank's policy.

Frequently Asked Questions

What if I cash a Series EE bond before it reaches face value?

Series EE bonds are may provide to reach face value (double the purchase price) within 20 years. If you cash before that point and the bond has not yet doubled, you still receive whatever it is currently worth — the may provide does not mean you get the full face value early. After 20 years, if the bond has not doubled, the Treasury automatically adds the difference to bring it to face value.

Can I cash a Series EE bond that someone else gave me?

Only if you are listed as the registered owner or co-owner on the bond. If the bond is registered to someone else, that person must redeem it or sign a form authorizing you to redeem it on their behalf. Contact the Treasury or your bank for the authorization form required.

Do I have to cash the entire bond, or can I cash part of it?

Series EE bonds are all-or-nothing — you cannot redeem half a bond and keep the other half earning interest. When you redeem, the entire bond is cashed and stops earning interest. If you own multiple bonds, you can choose which ones to cash and leave others untouched.

What if the bond is lost or destroyed?

Bring whatever remains of the bond to your bank, or contact the Treasury directly. The Treasury can verify ownership through your Social Security number and issue a replacement bond or process a redemption. This takes longer than a standard redemption — usually two to four weeks — but your money is not lost.

How do I know how much my Series EE bond is worth right now?

The Treasury publishes current values for all Series EE bonds on treasurydirect.gov. Enter your bond's series, denomination, and issue date, and the calculator shows the current value and interest earned. You can also ask your bank when you bring the bond in — they can look it up before you redeem.