Investors purchase them for less than their face value and let them build up to full face value at maturity. One can purchase Series EE bonds at banks or through payroll deduction plans. The investor can allow the accrued interest to be taxed each year, or he can defer it until the bond is redeemed. Tax may even be deferred beyond this date if the investor exchanges his bond for a Series HH bond. Series HH bonds are savings bonds that do pay interest and are sold at their face values.
Interest is paid twice per year.
Series HH bonds may be redeemed after six months. They normally mature in ten years but can be extended to twenty. Series HH bonds can only be obtained as exchanges of Series E or Series EE bonds. They come with fixed rates of interest. As noted earlier, marketable issues are issues that can be sold to other parties on the secondary market.