Personal Investment & Financial Planning Q`s/Series I-Bonds

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Question
CAN Series I-BOND Interest be claimed annually?
Thank you

Answer
Hi. When you say "claimed" do you mean claiming the interest on your tax return? Here is how I Bond interest works; there is a stated annual interest rate that gets paid every 6 months. This interest payment is considered taxable income. In addition, there is an "inflation adjustment" which cause the underlying value of the bond to go up. This value increase is also taxable, even though you do not receive this value increase in the form of an actual payment at the time the value adjustment is made. Instead, you receive this value increase when you either sell the bond or it matures. This is what is called "phantom income". I hope this helps.

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