With Tax Day fast approaching – and a soul-crushing week in my rearview mirror – I’m pleased to report that our taxes are done. We once again ended up owing and we did the old overpay to get I-Bonds trick.
So now… We wait.
As a reminder, the Treasury (mostly) eliminated paper savings bonds a couple of years ago. So now, instead of being able to buy $5k in paper bonds and $5k electronically each year, you can buy $10k in electronic bonds.
But there’s a loophole. You can use Form 8888 to request that up to $5k (in $50 increments) of your tax refund be paid to you in the form of paper Series I Savings Bonds. This is over and above your normal $10k allotment.
The only stumbling block is that you have to be expecting a refund for this to work. While it’s possible to adjust your withholding or otherwise make overpayments throughout the year, it’s probably easier to create the overage just before filing.
To do this, you can either submit a last minute quarterly payment (even if the January 15th deadline has passed) or you can request an extension of the filing deadline. Either way, this allows you to figure out exactly how much to pay in to create the $5k (or whatever) overage.
Last year we filed an extension, let the payment clear, and then filed our return. This year we were a bit more on the ball so I was able to make a (late) quarterly payment, wait for it to clear, and then file our return. Our savings bonds should be arriving in a few short weeks.