Savings bonds are valuable assets that are usually purchased as a part of an investment or retirement plan. The bonds are issued in the name of the purchaser, but can you transfer them into another person's name? If so, how is the process completed? These are questions that are frequently asked by savings bondholders. If you're wondering how this process is accomplished you're in the right place. Here is everything you need to know about the transfer of savings bonds.
What is a savings bond?
A US Savings Bond is a debt security that the United States Department of the Treasury issues to an investor. The investment helps the US government to borrow more efficiently. These are safe investments that are backed by the credit of the United States government and they deliver a return on the investment as the bond reaches maturity.
Can you transfer a savings bond into another person's name?
According to TerrySavage.com, savings bonds may be transferred into the name of another person if you own the bond. The answer to the question is yes, but there is a caveat that is attached. The savings bond must be in your name. They are yours to do with what you wish. You may request a formal change of title to switch the bonds into the names of other persons. If the bonds are transferred as a gift and you completely remove your name from the bonds, you are responsible for paying taxes on all of the accrued interest of the bonds.
Reasons for transferring savings bond
There are several reasons why you might wish to transfer a savings bond to someone else. One of the main reasons is for gift giving. Parents, grandparents, aunts, or uncles may give their children savings bonds as a gift, or transfer ownership to a godchild, grandchild, niece, nephew, etc. Some owners may transfer the bonds to a newly married couple, but the main reason for transfer is for gift giving.
How the process pf transferring a saving bond to another person is done
Zacks explains the process of transferring a savings bond into the name of another person. Every US Savings bond issued bears the name of the owner or owners in print on the bond. Only an owner with his or her name appearing on the bond may cash in or transfer the bond. The first step in the process is to complete a reissue request. This form is completed and sent to the US Treasury along with the bond. You can find the form online at the official US Treasury website. If you have no way to download the form you may also contact the US Treasury and ask them to mail the Request to Reissue United States Savings Bonds.
Complete the form and formal processing
You may complete the form online. Print out a hard copy. Do not sign the document yet. You must sign in from of a bank officer. You will be required to provide identification at the time of the signing. The person listed on the form may transfer the bond and to have his or her name removed from it. If there are two persons listed as co-owners on the bond, only one person is required to sign. The remaining person's name will remain on the bond. Both parties must sign along with the person having his or her name added to have their names removed. The form, along with the savings bond, must then be mailed to the US Department of Treasury to complete the process of transferring the bond.
Any owner may transfer his or her ownership rights to the bond, but may not speak for the other party for series EE savings bonds. Series I savings bonds qualify to have one of the owner names change in the event of divorce or death of the spouse. The appropriate completed and authenticated form along with the bond must be sent via registered mail to the address that is provided on the form. After you complete the process, you will receive a notification via an electronic account at the TreasuryDirect.gov website. You will not receive a paper bond back from the department.
How to set up an electronic account with the US Treasury Department
There are three simple steps involved with setting up an account with the US Treasury Department. Go to this webpage to create the account. First, select the account type that you desire to open. Next, have personal information on hand to provide your tax ID number. This is either your social security number or your EIN. You will also need a valid e-mail address and your bank account and routing number. You will then proceed forward to create a password. This should be a secure password that you don't share with anyone else for security purposes. You will also be promoted to complete a password reminder. You will also choose a personalized image, a caption, and security questions. After you've completed these three steps your account with the US Treasury Department will be set up.
It's not difficult to transfer savings bonds to another person, but there are a few specific steps that you must take to do so. You must download, print, and complete the proper form from the official US Treasury Department website and sign it in front of a bank official before sending it in through registered mail. The new owner sets up an electronic account at the Treasury Department website. Once an account has been set up it can be used to check the status of a newly transferred savings bond. Account holders will also have the option of purchasing other savings bonds directly through your account on the official US Treasury website.
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Written by Allen Lee
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