Satisfactory proof of identify is required in all cases. All Series HH bonds are obtained from and redeemed by Federal Reserve banks or branches or the Bureau of the Public Debt. Most local financial institutions will help in these transactions. Some bond holders prefer to receive current income twice yearly through HH bonds. People who make this exchange can continue to defer taxes on the interest already earned on their former E or EE bonds or savings notes until the HH bonds are redeemed.
Exchanges become particularly advantageous as E bonds near final maturity.
If this option is chosen, taxable interest is noted on the face of the new HH bonds. To retain the tax-deferral privilege, E and EE bonds and savings notes must be exchanged for HH bonds no later than one calendar year after the bonds or notes reach final maturity. For example, E bonds purchased on any day in the month of December 1949 reached final maturity on Dec. 1, 1989. To retain tax deferral, the E bonds must have been exchanged for HH bonds no later than Dec. 31, 1990. The semiannual interest earned by the HH bonds must be reported annually for federal income tax purposes.