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How To Record the Purchase or Redemption of U.S. Savings Bonds

Updated: 8/11/2011 | Article ID: GEN82458

  • Record the purchase of U.S. savings bonds

    Record the purchase of U.S. savings bonds by adding a U.S. savings bond to the Security List.

  • Record the redemption of U.S. savings bonds (at or before maturity)
    1. In the Account Bar list, select the account you want to use.
    2. On the Transactions tab, click Enter Transactions.
    3. In the Enter transaction list, choose Sell - Shares Sold.
    4. In the Number of Shares field, enter the number of bonds.
    5. In the Price field, enter the price you paid per bond (the difference between your purchase price and the redemption price is taxable interest).
    6. Select the account you'd like the amount of the sale deposited in.
    7. Identify the lots you want to use for this transaction.
    8. Add a transaction for interest income. (Optional)

Notes

If you use the cash method of accounting, as most individual taxpayers do, you generally report the interest on U.S. savings bonds when you receive it. Use the Income dialog to record the remainder of the proceeds as interest income.

If you use the accrual method of accounting, you must report interest on U.S. savings bonds each year as it accrues. For details, see zero-coupon bonds.

If you are using What Should I Sell to evaluate whether a U.S. savings bond should be cashed in early, make sure you have entered the savings bond interest in the penalties field of the Transaction Fees dialog for the account from which you purchased the bond. For example if a U.S. Series I Savings Bond pays 5% interest, then cashing it in early would cost you the most recent six month's interest (5% in this case).

Recording a transaction in Quicken does not execute a real-world trade, transfer, or other transaction. Contact your broker to execute trades or transfers, and then manually record the transactions in Quicken-better yet, download them directly from your participating financial institution.

 
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