You can cash out Series EE bonds at your bank, through the Treasury Department, or by mail—but the process and timing depend on the bond's age and where you hold it.

Series EE bonds are savings bonds issued by the U.S. Treasury. Once you own one, you can turn it back into cash, but you cannot do it the same way you would withdraw money from a bank account. The method you use depends on whether the bond is a paper bond or a digital bond held in TreasuryDirect, and how long you have owned it.

If you own a paper Series EE bond, your bank or credit union can cash it for you on the spot—usually within minutes. If you own a digital bond through TreasuryDirect (the Treasury's online system), you request the redemption through your account and the money arrives in your bank account within a few business days. The catch: Series EE bonds issued after May 2003 carry a penalty if you cash them out before five years have passed. That penalty is the last three months of interest.

Key Takeaways

  • Paper Series EE bonds can be cashed at most banks and credit unions without an appointment, though you will need to bring the bond and a photo ID.
  • Digital bonds held in TreasuryDirect are redeemed through your online account and take three to four business days to reach your bank.
  • Bonds cashed before five years have passed lose the last three months of interest, so waiting until year five eliminates that penalty.
  • You will receive a 1099-INT form from the Treasury at tax time reporting the interest you earned, which counts as taxable income on your federal return.
  • The Treasury does not send you a check—redemption money goes directly to your bank account or is paid in cash at a bank branch.

Cashing a paper Series EE bond at a bank

Walk into any bank or credit union where you have an account and ask to redeem a savings bond. Bring the bond itself and a photo ID. The teller will verify the bond's serial number and current value, then either pay you in cash or deposit the money into your account—you choose. The whole process takes about five to ten minutes.

Not every bank will cash bonds from customers who do not have an account there. Call ahead if you are cashing at a branch where you do not bank. Some credit unions have stricter policies and may only cash bonds for members. If you cannot find a bank willing to cash it, you can mail the bond to the Treasury Department with a form, though that takes two to three weeks.

Redeeming a digital bond through TreasuryDirect

Log into your TreasuryDirect account at treasurydirect.gov. Find the bond you want to cash out in your portfolio, select it, and choose "Redeem." The system will ask you to confirm the redemption and will show you the current value of the bond. Once you confirm, the request is submitted.

The Treasury processes redemption requests on business days. The money will be deposited into the bank account you have on file with TreasuryDirect within three to four business days. You will not receive a check or any physical confirmation—the deposit simply appears in your account. If you need to change which bank account receives the money, you can update that in your TreasuryDirect settings before you submit the redemption request.

The five-year penalty and when it applies

Series EE bonds issued after May 2003 impose a penalty if you cash them before five years have passed. The penalty is three months of interest. This means if you cash a bond at year three, you lose the interest you would have earned in months 10, 11, and 12 of ownership. The bond still pays you its current value minus that three-month interest amount.

Bonds issued before May 2003 do not have this penalty, though they are now quite old. If you own an older paper bond and are unsure of the issue date, the date is printed on the bond itself. Once your bond reaches five years old, you can cash it without any penalty, no matter how long you hold it after that.

What happens to the interest you earned

The interest on Series EE bonds is subject to federal income tax. You do not pay tax when you cash the bond—you pay it when you file your tax return. At the end of each calendar year, the Treasury sends you a 1099-INT form (or makes it available in your TreasuryDirect account) showing the interest you earned on all your bonds that year, whether you cashed them or not.

You report this interest as income on your federal tax return. The amount of tax you owe depends on your overall income and tax bracket. Some people choose to report the interest each year as the bond earns it, rather than waiting until they cash it, but most people report it only when they redeem. Either way, the total tax owed is the same.

Mailing a bond to the Treasury if you cannot use a bank

If you cannot cash a paper bond at a bank, you can mail it directly to the Treasury Department. You will need to fill out Form PD F 1522 (Paying Agent's Advice—Delivery of Savings Bonds), which you can download from the Treasury website or request by mail. Include the completed form, the bond itself, a copy of your photo ID, and a letter stating your name, address, and the amount you are requesting.

Mail the package to the address listed on the form. The Treasury will verify the bond, process the redemption, and mail you a check. This method takes two to three weeks and carries a small risk that the bond could be lost in the mail, so consider it only if a bank option is truly unavailable. Some people use certified mail for added security.

Redeeming bonds held by someone else or in an estate

If you are cashing a bond that belongs to someone else—a child, a parent, or a deceased person's estate—the process is more complex. For a child's bond, the parent or legal guardian must present the bond and their own ID at a bank. For a bond in an estate, the executor or administrator will need to provide legal documentation of their authority, such as letters testamentary or a court order.

Banks vary in what documents they will accept. Call the bank ahead of time and describe the situation. If the bank cannot help, the Treasury Department can process the redemption by mail, but you will need to include the appropriate legal documents with your request. This route takes longer but is sometimes necessary.

Frequently Asked Questions

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

Yes. Series EE bonds are may provide to reach face value in 20 years, but you can cash them at any time after you own them. If you cash before 20 years, you will receive whatever the bond is currently worth, which may be less than face value. You will also lose three months of interest if the bond is less than five years old.

What if I lost my paper bond or it was damaged?

Contact the Treasury Department's Savings Bonds Division. You will need to provide the bond's serial number, issue date, and denomination. The Treasury can issue a replacement bond or process a redemption without the physical bond, though this takes several weeks and requires documentation of the loss.

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

You must cash the entire bond. You cannot split a Series EE bond or redeem only a portion of it. If you need only part of the money, you would have to cash the whole bond and then use or save the full amount.

Will cashing a Series EE bond affect my benefits or taxes?

The interest you earned is taxable income and must be reported on your federal tax return. Depending on your total income, this could affect your tax bracket or, in some cases, your may be able to access for means-tested benefits. Consult a tax professional if you are concerned about how the redemption will affect your specific situation.

How do I find out what my Series EE bond is currently worth?

For digital bonds in TreasuryDirect, log into your account and the current value is displayed next to each bond. For paper bonds, a bank can look up the value when you bring it in to cash it. You can also use the Treasury's Savings Bond Calculator on treasurydirect.gov if you know the bond's issue date and denomination.