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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16575
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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I found a lot of US E savings bond I forgot about that matured

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I found a lot of US E savings bond I forgot about that matured over 10 years ago and have not cashed them in yet. Since I did not report the income in the year the bonds matured . How do I report this and can the interest & penalties cost more that the value of the bond.

MyVirtualCPA :

Thank you for your question, and thanks for using JustAnswer.com

MyVirtualCPA :

Did you file your tax returns 10 years ago, when the bonds matured?

MyVirtualCPA :

Even though you did not claim the interest, did you actually file a tax return

JACUSTOMER-nxosps7c- :

yes I did

MyVirtualCPA :

Well, then the statute of limitations has ran and the IRS cannot assess tax on you for that, unless they can prove that you fraudulently did not claim the income

MyVirtualCPA :

and this sounds like a simple oversight.

JACUSTOMER-nxosps7c- :

I also have some that have matured within the last 6 years , they were all locked in a safe deposit box that I forgot about and I am also overseas so cant get to it

MyVirtualCPA :

For those, what you do is you file amended returns and pay the tax and penalties on the unreported amount

JACUSTOMER-nxosps7c- :

thought the farthest back one could go is 3 years with amended returns

MyVirtualCPA :

well, that's true in that you can't get a refund after 3 years but you can amend up to 6 years

MyVirtualCPA :

Especially if you owe additional tax

JACUSTOMER-nxosps7c- :

so the original question was can the tax and penalties for 6 years be more than the value of the bond, ie. is it better to just not cash them in

MyVirtualCPA :

No, it won't be greater than the value of the bonds

MyVirtualCPA :

interest is very low these days

JACUSTOMER-nxosps7c- :

ok thank you

JACUSTOMER-nxosps7c- :

thats it

MyVirtualCPA :

You're welcome. Is there anything else I can help you with?

MyVirtualCPA :

If not, please rate my response as "excellent" so that I may receive credit for assisting you today

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Thanks, XXXXX XXXXX your positive rating. Please come back and visit MyVirtualCPA for any of your tax, finance, or social security needs. It was a pleasure working with you today.

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