location and assistance grant may be used for 
the following activities: 
(i) OWNER LOCATION AND NOTIFICA-
TION EFFORTS.—In addition to the activi-
ties required under subparagraph (A)(i), 
activities to locate the owners of specified 
unredeemed savings bonds referred to the 
State and to notify such owners of such 
bonds, including matching bond records 
against State databases or constituent lists 
maintained by State legislators, research-
ing the location of such owners, and pub-
lishing notices in newspapers and maga-
zines of general circulation. 
(ii) ASSISTANCE TO BONDHOLDERS.— 
Actual and attempted communications with 
owners of specified unredeemed savings 
bonds about methods of bond redemption, 
requirements for filing claims for missing 
bonds or other similar claims, the status of 
claims for bonds, and similar matters. 
(C) RESTRICTIONS ON LOCATION AND NO-
TIFICATION EFFORTS.—The Secretary may pro-
vide for such restrictions on methods used to lo-
cate and notify owners of specified unredeemed 
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savings bonds as the Secretary deems appro-
priate, including any restrictions on the use of 
commercial locator services. 
(5) PROVISION OF BOND RECORDS.—Subject to 
any other requirements and limitations provided in 
this section, the State coordinator shall provide to a 
State receiving a bondholder location and assistance 
grant such records with respect to the bonds re-
ferred to such State under subsection (c)(2)(C)(iii) 
as are necessary and appropriate to carry out the 
purposes of such grant. 
(c) EXAMINATION AND REFERRAL OF BONDS.— 
(1) IN GENERAL.—Not later than 90 days after 
the date of the enactment of this Act, the Secretary 
shall enter into a cooperative agreement (within the 
meaning of section 6305 of title 31, United States 
Code) with the State coordinator for the purpose 
of— 
(A) identifying the owners of specified 
unredeemed savings bonds, and 
(B) referring specified unredeemed savings 
bonds to the State of residence of the owner, in 
the case of a State that is participating in the 
demonstration program by receiving a bond-
holder location and assistance grant under sub-
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section (b) for the fiscal year in which the refer-
ral is made. 
(2) AGREEMENT REQUIREMENTS.—The cooper-
ative agreement entered into under paragraph (1) 
shall provide for the following with respect to speci-
fied unredeemed savings bonds: 
(A) ACCESS TO BOND RECORDS.—The Sec-
retary shall provide the State coordinator with 
full access to records related to such bonds. 
(B) COMPILATION OF INFORMATION.—The 
State coordinator shall compile relevant infor-
mation with respect to such bonds and make 
the results of such compilation available to the 
Secretary for the Secretary’s review and concur-
rence. 
(C) REFERRAL OF BONDS TO STATES FOR 
PROCESSING.— 
(i) RECOMMENDATION OF STATE OF 
REFERRAL.— 
(I) The State coordinator shall 
make a recommendation to the Sec-
retary regarding to which State each 
bond should be referred for owner lo-
cation and notification activities. 
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(II) Such recommendation shall 
be based on the registered owner’s ad-
dress of record being in the State to 
which the bond will be recommended 
to be referred as determined in ac-
cordance with Government Auditing 
Standards for appropriateness and 
sufficiency. 
(ii) FINALITY OF DETERMINATION.— 
The Secretary shall make the final deter-
mination regarding the State, if any, to 
which each bond should be referred for 
processing after taking into account the 
recommendation of the State coordinator. 
Such determination by the Secretary shall 
be conclusive and shall not be subject to 
judicial review. 
(iii) REFERRAL.—Subject to clauses 
(iv) and (v), in the case of a State that is 
participating in the demonstration pro-
gram by receiving a bondholder location 
and assistance grant under subsection (b) 
for the fiscal year in which the referral will 
be made, the Secretary shall refer to such 
State each bond that the Secretary has de-
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termined should be referred to such State, 
for activities under such grant. 
(iv) LIMITATION
BASED
ON
AVAIL-
ABILITY OF FUNDS.—The Secretary shall 
not refer a bond to a State described in 
clause (iii) unless sufficient funds are 
available to provide to such State the full 
grant amount described in subsection 
(b)(3) for the fiscal year in which the re-
ferral will be made. 
(v) LIMITATION BASED ON MAXIMUM 
ALLOWABLE NUMBER OF BONDS.— 
(I) IN GENERAL.—The State co-
ordinator shall not examine under the 
agreement described in this subsection 
more than the number of bond 
records that is reasonably expected to 
result in the referral to the States of 
a number of such bonds that is not 
greater than such maximum allowable 
number. 
(II) MAXIMUM ALLOWABLE NUM-
BER
OF
SPECIFIED
UNREDEEMED 
SAVINGS
BONDS.—For purposes of 
this clause, the maximum allowable 
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number of specified unredeemed sav-
ings bonds is a number of such bonds 
such that the sum of— 
(aa) the product of— 
(AA) the number of 
bonds, and 
(BB) $30, and 
(bb) the estimated amounts 
to be paid by the Secretary to the 
State coordinator under para-
graph (3), 
equals $300,000,000. 
(D) SEARCHABLE
DATABASE.—After the 
Secretary concurs with the information com-
piled under subparagraph (B), the State coordi-
nator shall establish a searchable database 
which includes such information specified by 
the Secretary with respect to each bond and the 
State to which each bond is recommended to be 
referred for processing. The State coordinator 
shall update the information contained in such 
database 
(including 
information 
indicating 
which bonds have been redeemed) in such man-
ner as the Secretary may provide. 
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(3) PAYMENT
OF
FUNDS.—The cooperative 
agreement entered into under this subsection shall 
specify that the Secretary shall pay to the State co-
ordinator, from the funds appropriated for the dem-
onstration program, an amount equal to the reason-
able costs of carrying out the State coordinator’s du-
ties under the agreement. 
(d) CONFIDENTIALITY.— 
(1) RETURN
INFORMATION.—Except as pro-
vided in paragraph (2), for purposes of section 6103 
of the Internal Revenue Code of 1986, records pro-
vided to the State coordinator or to a State by the 
Secretary under this section shall be treated as re-
turn information as defined in section 6103(b)(2) of 
such Code. 
(2) 
EXCEPTION.—Notwithstanding 
section 
6103(b)(2)(A) of the Internal Revenue Code of 
1986, for purposes of this paragraph, the name and 
address of the holder of a bond and such other infor-
mation as may be specified by the Secretary shall 
not be treated as return information when provided 
to the State coordinator or to a State by the Sec-
retary. 
(e) DEFINITIONS.—For purposes of this section— 
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(1) REGISTERED
ADDRESS.—The term ‘‘reg-
istered address’’ means the address of the bond 
owner inscribed on the face of the bond or main-
tained by the Secretary at the time of final maturity 
of such bond. 
(2) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the Treasury or the Secretary’s del-
egate. 
(3) SPECIFIED UNREDEEMED SAVINGS BOND.— 
The term ‘‘specified unredeemed savings bond’’ 
means each outstanding United States savings bond, 
except that such bond shall not be treated as a spec-
ified unredeemed savings bond until the later of— 
(A) the date that is 5 years after the date 
of the maturity of such bond; or 
(B) the date of the enactment of this Act. 
(4) STATE.—The term ‘‘State’’ includes the 
District of Columbia and any territory or possession 
of the United States that maintains a program for 
the administration of unclaimed property. 
(5) STATE
COORDINATOR.—The term ‘‘State 
coordinator’’ means the eligible entity which is deter-
mined by the Secretary, after consultation with the 
States, to be best suited to carry out the activities 
described in subsection (c). For purposes of the pre-
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ceding sentence, the term ‘‘eligible entity’’ means 
any State or the National Association of Unclaimed 
Property Administrators. 
SEC. 4. WITHHOLDING OF TAX ON UNCLAIMED INTEREST. 
(a) IN GENERAL.—The Secretary of the Treasury 
shall deduct and withhold from the proceeds of any ma-
tured outstanding United States savings bond, on the later 
of the date of maturity of such bond or the date of the 
enactment of this Act, a tax in an amount equal to the 
applicable percentage of the amount which, if such bond 
were redeemed, would constitute interest. 
(b) APPLICABLE PERCENTAGE.—For purposes of 
this section, the applicable percentage is the 2nd highest 
rate of individual income tax under section 1(c) of the In-
ternal Revenue Code of 1986. 
(c) TREATMENT IN SAME MANNER AS WAGE WITH-
HOLDING.—Except as otherwise provided by the Secretary 
of the Treasury, for purposes of sections 3403 and 3404 
of the Internal Revenue Code of 1986 and so much of 
subtitle F of such Code (except section 7205) as relates 
to chapter 24 of such Code, payments to any person as 
a result of the redemption of any bond subject to with-
holding under this subsection shall be treated, at the time 
of maturation of such bond, as if such payments were 
wages paid by an employer to an employee. 
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(d) INCLUSION IN INCOME OF BONDHOLDER.—Ef-
fective on the date of maturity of any matured outstanding 
United States savings bond, the amount which, if such 
bond were redeemed, would constitute interest shall be 
treated as gross income of the holder of such bond for 
purposes of section 61 of the Internal Revenue Code of 
1986. 
(e) FILING OF AMENDED RETURNS.— 
(1) IN GENERAL.—Upon redemption of any ma-
tured outstanding United States savings bond, the 
bondholder may file an amended Federal income tax 
return for the taxable year of the maturity of such 
bond in order to claim a credit for the amount with-
held in such year under subsection (a), provided that 
such amended return includes the inclusion in the 
income of the bondholder of the amounts specified in 
subsection (d). 
(2) EXCEPTION
TO
STATUTE
OF
LIMITA-
TIONS.—An amended return filed by reason of para-
graph (1) shall be considered a return for purposes 
of sections 6501(a) and 6511(a) of the Internal Rev-
enue Code of 1986. 
(f) CONFORMING AMENDMENT.—Subsection (b) of 
section 1324 of title 31, United States Code, is amended— 
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(1) by striking ‘‘and’’ at the end of paragraph 
(1); 
(2) by striking the period at the end of para-
graph (2) and inserting ‘‘; and’’; and 
(3) by adding at the end the following new 
paragraph: 
‘‘(3) refunds due from the credit provision of 
section 4(e)(1) of the Unclaimed Savings Bond Act 
of 2009.’’. 
Æ 
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