Stepped basis on inherited Ibonds and EEbonds
My husband is in now in hospice care at an assisted living facility. We have I bonds that are due in 2033 and I cannot imagine that I would live that long either. How do they pass along to along to heirs? We know that appreciated stocks and our home will receive a stepped basis, but how are these bonds treated? Do they get stepped up basis or do the heirs have to pay all the interest accrual on them? Thank you for your answer.
Terry Says
Sadly, Savings Bonds are one of the few assets that does not pass to beneficiaries with a stepped up basis to beneficiaries. The ESTATE will owe the taxes on the increase in valuation, and that must be paid before the beneficiary receives the bonds.
