How Do You Calculate HH Bonds?


Quick Answer

The interest on Series HH U.S. savings bonds is calculated every six months at fixed interest rates, reports TreasuryDirect. Since 2003, the interest rate has been 1.5 percent, and as of February 2015 it remains the same. Series HH bonds are redeemable at face value.

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Full Answer

Series HH savings bonds were issued from January 1980 to August 2004 with 20-year maturity limits, so some HH bonds are still earning interest, reports TreasuryDirect, a service of the U.S. Department of the Treasury. Interest payments on HH bonds are sent by direct deposit to savings or checking accounts of the owners. Although federal, estate, inheritance and gift taxes are levied on Series HH bond interest earnings, they are not subject to state or local income taxes.

Series HH savings bonds were issued on paper in denominations of $500, $1,000, $5,000 and $10,000, as reported by TreasuryDirect. The bonds cannot be redeemed at local banks or other financial institutions, but only by post at the Federal Reserve Bank of Minneapolis. To redeem the bonds, account holders must provide a signature certified by a bank official on the back of the bonds along with direct deposit instructions and any other necessary supporting documents. Savings bonds are not transferable, so someone who has found or bought a savings bond from someone else cannot redeem it.

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