Series EE savings bond

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Series EE Savings Bond

In the United States, a savings bond, exempt from state and local taxes, with a fixed interest rate. The interest is adjusted every six months and is equal to 90% of the average 5-year Treasury security yield over the six months preceding the calculation. These bonds are sold at half of face value and pay par upon maturity, which is 30 years after purchase. They must be held for at least one year, and United States Treasury guarantees that it will double in value after 20 years. They are non-transferable and must either be held or redeemed. When used to pay for college education, they are exempt from federal taxes. Series EE bonds are the successors to Series E bonds, better known as war bonds.
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Series EE savings bond

A U.S. Treasury obligation that pays a variable interest rate and is sold to investors in denominations as low as $50 at a 50% discount from face value. Series EE bonds earn interest at 90% of the average yield on five-year Treasury securities for the previous six months. Bonds may be redeemed after six months early, but a three-month interest penalty is assessed for redemptions during the first five years. Federal income taxes on interest earned may be paid each year or may be deferred until the savings bond is redeemed. Interest earned on savings bonds is exempt from state and local taxation. See also Patriot Bond.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
1, 2017, through April 30, 2018, is only 0.10% (Treasury Direct, "May 2005 and Later (EE Bond Rates and Terms)," available at tinyurl.com/ycdsrolq).
In 2012, ERUSD extended by twenty years the Measure EE bond to take advantage of the low interest rates available, saving $1.7 million, according to a press release issued by the previous ERUSD superintendent, Dr.
Consequently, a Series EE bond purchased prior to May 1, 2005, earned a new rate of interest every six months.
print the words "Patriot Bond" on the Series EE bond. (12)
* The EE bond interest exclusion is phased out by a modified AGI limit.
As a trade-off, however, the EE bond yield is only 85% of the market yield on five-year Treasury securities if the EE bonds are held at least five years.
The Series EE bond is an appreciation-type security that accrues interest for 30 years.
The Series EE bond is an appreciation-type security that is issued for an original maturity of 12 years and is available in denominations of $50, $75, $100, $200, $500, $1,000, $5,000, and $10,000.
In the past EE bond owners could defer reporting their interest income beyond the normal maturity date by exchanging their EE bonds for HH bonds.
income tax liability (2) $1,481 Overall tax savings (1) This example assumes that the total interest of $5,000 is earned on a 10-year Series E or EE bond and an equal amount of interest would be recognized annually on the individual return.