"Patriot" Savings Bonds
Current Interest Rate for "Patriot" EE Bonds purchased May 1, 2014 to Oct 31, 2014: 0.50%
What is a "Patriot" Bond?
Patriot Bonds are simply Series EE Bonds which have the name "Patriot Bond" stamped on them. Yes, that's all that they are. Other than this stamp, they are no different from actual EE Savings Bonds.
They are identical in every way to the paper EE Savings Bonds except that any EE Bond purchased through financial institutions after December 10, 2001 has the words "Patriot Bond" printed on the top half of the bond between the Social Security Number and the Issue Date.
ALL EE SAVINGS BOND TERMS AND CONDITIONS APPLY TO PATRIOT BONDS.
Where Do the Proceeds from Patriot Bonds Go?
The proceeds of the Patriot Bond will go into the Treasuries General Fund and are not specifically earmarked for any particular war-time spending or program funding. Monies for both war-time spending and other federal government spending draw from this general fund, which may contribute to fighting the war on terrorism.
Things You Should Know About the "Patriot Bond"
The first Patriot Bond was sold mid-December 2001.
Patriot Bonds are purchased over-the-counter at banks, credit unions and other such financial institutions.
Exactly like EE Savings Bonds, Patrio Bonds are purchased for half their face value, increase in value monthly and interest is compounded semi-annually
Limitations on purchasing Patriot Bonds
Because of the $20,000 bond limitation which began Jan. 2008 - you can purchase a maximum face value of $10,000 ($5,000 cash-purchase value) in EE bonds (Patriot Bonds) a year
Maturity of a Patriot Bond
Patriot bonds earn interest for 30 years from their issue date.
They are guaranteed to reach initial maturity (their face value) on their 20th year anniversary.
There is a 3-month interest penalty if the bond is redeemed before 5 years.
Taxation on Interest
There is no state or local income tax on the interest earned.
Interest earned could be tax exempt if used for education purposes (see Education bond details).
What does a Patriot Bond look like?
The Series EE Patriot Bond is identical to other Series EE bonds except that the words "Patriot Bond" are printed on the top half of the bond between the social security number and issue date.Take a look at the bond below.