If you’ve got paper savings bonds sitting in a drawer somewhere, TreasuryDirect lets you move them into a digital account — which makes them a lot easier to track and manage. Before you send anything in, here’s what you should know.
The conversion process works for Series EE and Series I Savings Bonds only. You can convert bonds registered in your name alone, or ones that include a co-owner or a payable-on-death (POD) beneficiary.
After conversion, your bonds live in your TreasuryDirect account much like anything else you’d buy there directly. But if a bond has a co-owner, a few specific rules apply:
Businesses and other entities can open TreasuryDirect accounts and convert paper bonds, typically through an Account Manager. The thing to understand here is that all securities in an entity account get registered under the entity’s name — full stop. So whatever the original paper bond said, once it’s converted, it will be re-registered to match the entity account.
If the bonds weren’t originally issued in the entity’s name, expect TreasuryDirect to request documentation confirming the transaction is legitimate before moving forward.
Already-matured bonds — ones that have stopped earning interest — won’t just sit in your account after conversion. TreasuryDirect will redeem them automatically and park the proceeds in a Zero-Percent Certificate of Indebtedness (C of I) in your primary account. Any taxable interest will be reported to the IRS for the relevant year.
Conversions go through a tool called SmartExchange, which you’ll get access to once you’ve set up a Conversion account. After that, a “My Converted Bonds” section will appear under Linked Accounts Information on your Account Summary page.