Series EE Bonds or I-Bonds http://www.treasurydirect.gov/indiv/...axconsider.htm they are taxed at the federal level Internal Revenue Service: Schedule B http://www.treasurydirect.gov/indiv/...axconsider.htm "Individual - Series EE/E Savings Bonds Tax Considerations" U.S. Treasury: Series EE/E Savings Bonds Tax Considerations Series EE/E Series EE/E Savings Bonds Tax Considerations TreasuryDirect: Series EE/E Savings Bonds Tax Considerations U.S. Treasury: Series EE/E Savings Bonds Tax Considerations http://www.treasurydirect.gov/indiv/...axconsider.htm