I've done some research on the internet and most people say it's unlikely the IRS would be interested in pursuing the issue of old savings bonds, especially if the amount is small. However, I've always been scrupulously honest in my dealings with the IRS so I'm not really comfortable with not knowing the outcome. I can live with losing all the money to penalties and interest, but is there a chance I could end up owing money if the worst case scenario happens?======>> Sorry however I should say basically nobody knows what ?ll happen to you on the old series E savings bond; in general as you can see, Series E Bond interest is reportable for Federal income tax purposes for the year in which the Series E bonds are redeemed, reach final maturity, or are cashed in, whichever occurs earliest. Alternatively, a bond owner was able to elect to report Series E interest as it accrues. Series E bond holders who elected to defer reporting interest accruals for Federal income tax purposes can continue the deferral as long as accrued Series E bond interest is included in the purchase price (face or par amount) of Series HH bonds received in exchange.but the series E savigs bonds that you hole are pretty old and you even do not know if your great-aunt ever paid taxes on the interest or etc. When you cash in the savings bond, the financial institution will issue a Form 1099-INT for the interest earnings.
The 1099-INT should reflect the year the interest earnings became taxable ? that is, the year the bonds matured.. you may talk to your CPA/a n IRS enrolled Agent, or ask the irs by calling its toll-free Telephone Assistance for Individuals at (800) 829-1040.