IRS Publication 550 — Investment Income and Expenses
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“Constructive receipt. Y ou constructively receive in- come when it is credited to your account or made availa- ble to you. Y ou do not need to have physical possession of it.”
you buy a bond in the name of another person, who is the sole owner of the bond the person for whom you bought the bond. you and another person buy a bond as co-owners, each contributing part of the purchase price both you and the other co-owner, in proportion to the amount each paid for the bond. you and your spouse, who live in a community property state, buy a bond that is community property you and your spouse. If you file separate returns, both you and your spouse generally report half of the interest.
Purchased jointly. If you and a co -owner each contributed funds to buy Series E, Series EE, or Series I bonds jointly and later have the bonds reissued in the co-owner's name alone, you must include in your gross income for the year of reissue your share of all the interest earned on the bonds that you have not previously reported. The former co -owner does not have to include in gross income at the time of reissue his or her share of the interest earned that was not reported before the transfer. This interest, however, as well as all interest earned after the reissue, is income to the former co-owner. This income-reporting rule also applies when the bonds are reissued in the name of your former co -owner and a new co-owner. However, the new co-owner will report only his or her share of the interest earned after the transfer. If bonds that you and a co-owner bought jointly are reissued to each of you separately in the same proportion as your contribution to the purchase price, neither you nor your co -owner has to report at that time the interest earned before the bonds were reissued.
Example 1. You and your spouse each spent an equal amount to buy a $1,000 Series EE savings bond. The bond was issued to you and your spouse as co -owners. You both postpone reporting interest on the bond. You later have the bond reissued as two $500 bonds, one in your name and one in your spouse's name. At that time neither you nor your spouse has to report the interest earned to the date of reissue.
Example 2. You bought a $1,000 Series EE savings bond with your own funds. The bond was issued to you and your spouse as co -owners. You both postponed reporting interest on the bond. You later have the bond reissued as two $500 bonds, one in your name and one in your spouse's name. You must report half the interest earned to the date of reissue.
Transfer to a trust. If you own Series E, Series EE, or Series I bonds and transfer them to a trust, giving up all rights of ownership, you must include in your income for 12 Chapter 1 Investment Income Publication 550 (2025)
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