I-Bond, or Series I Savings Bonds, are a type of savings bond issued by the U.S. Treasury Department. These bonds are a low-risk investment option that allows investors to earn interest while protecting their principal from inflation.

The interest rate on I-Bond is a combination of a fixed rate and an inflation rate. The fixed rate remains the same for the life of the bond, while the inflation rate is adjusted every six months to reflect changes in the Consumer Price Index (CPI).

Investors can purchase I-Bond in denominations ranging from $25 to $10,000, with a maximum purchase limit of $10,000 per calendar year per Social Security number. I-Bond have a minimum holding period of 12 months, and if the bond is redeemed before it is five years old, investors will forfeit the last three months of interest.

I-Bonds can be purchased online through the Treasury Department's website or through a financial institution that participates in the program. Interest earned on I-Bonds is exempt from state and local income taxes, and federal taxes can be deferred until the bond is redeemed or reaches maturity.

Savings Bond - I-Bond

I bond - Series I savings bonds protect you from inflation. With an I bond, you earn both a fixed rate of interest and a rate that changes with inflation. Twice a year, we set the inflation rate for the next 6 months.

Earn Interest on I-Bond

Earn interest monthly on I savings bonds. Interest is compounded semiannually, meaning every 6-months we apply the bond’s interest rate to a new principal value. The new principal is the sum of the prior principal and the interest earned in the previous 6-months.

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Your bond's value grows both because it earns interest and because the principal value gets bigger.

Interest rates for all I-bonds are issued in 2 ways:
1. Matrix showing fixed rates, inflation rates, and combined rates together (PDF)
2. Separate tables for fixed rates, inflation rates, combined rates

I-bonds earn interest for 30-years (unless I-bond is cashed before then)

When do I get the interest on my I-bond?

With a Series I savings bond, you wait to get all the money until you cash in the bond.

Electronic I-bonds: Paid automatically when the bond matures (if not cashed before then).

Paper I-bonds: You must submit paper bond to cash it.

Can I cash I-bonds before 30 years?

You can redeem your I bond after 12 months. How to find the value of Series I savings bond?

If you have a Series I electronic bond, you can see it's worth in your TreasuryDirect account.

Must I pay tax on what the bond earns?

Federal income tax: Yes

State and local income tax: No

Federal estate, gift, and excise taxes; state estate or inheritance taxes: Yes

You choose whether to report each year's earnings or wait to report all the earnings when you get the money for the bond.

If you use the money for qualified higher education expenses, you may not have to pay tax on the earnings.

How much does an I bond cost?

Electronic I-bonds: $25 minimum or any amount above that to the penny. For example, you could buy an I bond for $36.73.

Paper I bonds: $50, $100, $200, $500, or $1,000

Is there a maximum amount I can buy?

In a calendar year, one Social Security Number or one Employer Identification Number may buy:
up to $10,000 in electronic I-bonds
up to $5,000 in paper I bonds (with your tax refund)
For individual accounts, the limits apply to Social Security Number of the first-named in the registration.

There are six Americans featured on I-Bonds.

1. Helen Keller (1880-1968) $50 denomination

2. Dr. Hector P. Garcia (1914-1996) $75 denomination

3. Dr. Martin Luther King, Jr. (1929-1968) $100 denomination

4. Chief Joseph (1840-1904) $200 denomination

5. George C. Marshall (1880-1959) $500 denomination

6. Albert Einstein (1879-1955) $1,000 denomination