. . . both will earn interest for up to 30 years.

. . . both will have interest added each month and compounded  

      semiannually.

. . . both must be held for 12 months (from date of issue) before they

      can be redeemed.

. . . both will qualify for the Education Tax Exemption program.

. . . both will forfeit three months of interest if redeemed before they

      are five years old.

. . . both are 100% exempt from state and local taxes.

. . . both will grow tax deferred until they are redeemed.

      (you may choose to report the growth in value of your bonds on

      your tax return every year rather than have a large tax liability in

      the year when the bond(s) are eventually redeemed).

. . . the interest earned by each bond must be reported on your Federal

      Income Tax return in the year they are redeemed - or after 30

      years - whichever comes first.

The Differences Between "I" and "EE" bonds

"I" bonds are purchased (issued) at 100% of their face value.

("EE" bonds are purchased at exactly half their face value).

 

"I" bonds CAN NOT be exchanged for "HH" bonds.

Notice: August 31st, 2004 was the last issue date for HH/H Bonds. After August 31, 2004, the government discontinued the exchange of bonds for HH/H bonds. Current holders of HH/H Bonds will not need to do anything different than they normally would have.