Claiming savings bonds on your taxes?
by admin ~ April 11th, 2006 . Filed under: United States .
Maria K asked:
I had a savings bond that had $1,800 in interest and i didn’t claim this on my taxes. What will happen since i didn’t claim this on my taxes?
Graham Pritzker
I had a savings bond that had $1,800 in interest and i didn’t claim this on my taxes. What will happen since i didn’t claim this on my taxes?
Graham Pritzker
April 11th, 2006 at 10:57 pm
Are you saying that you cashed out the savings bond (E bond), or do you have a bond that has currently generated $1,800 in interest but is not yet been cashed? If you cashed it out and the proceeds weren’t used to pay college tuition for a dependent, then yes, the interest is taxable. If it didn’t show up on your 1040, the IRS will be sending you a notice looking for the tax due, plus penalties and interest. If you haven’t cashed the bond, then the interest isn’t taxable yet.
April 15th, 2006 at 8:42 am
You will get a notice and demand for the balance due. They will add interest.
The best action is to file Form 1040X and include the amount. Enclose your check for the balance due.
April 18th, 2006 at 8:14 am
There are two ways to claim savings bond interest - (1) every year as it accrues or (2) all at once when you cash it. If you haven’t been declaring it all along since you bought them, you’re stuck with #2. If you cashed it in in 2008 and didn’t include the interest, you’ll have to file an amended return.