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When you cash Series EE and I bonds, the redemption slip from the teller and the eventual 1099-INT rarely line up with the cost basis you need for an education exclusion. That gap is where Form 8818 helps. You never mail it to the IRS; you keep it in your files as your own written record of the bonds you cashed, and the totals feed Form 8815 if you qualify.
Only bonds issued after 1989 qualify, and the owner had to be at least age 24 before the bonds were issued. Part I records paper Series EE bonds, where line 3 multiplies total face value by 50% because paper EE bonds sold at half face value, while Part II records Series I and electronic EE bonds at full face value. Line 8, redemption proceeds minus total cost, gives the interest that flows to your 8815, and you keep a separate Form 8818 for each cashing event.
Key Takeaways
- Form 8818 (Rev. December 2007, Cat. No. 10097L) is the Optional Form To Record Redemption of Series EE and I U.S. Savings Bonds Issued After 1989. It is a recordkeeping worksheet you keep in your files, not a form you file with the IRS.
- Only bonds issued after 1989 qualify, and the owner must have been at least age 24 before the bonds were issued for the interest to be eligible for the education savings bond exclusion.
- Part I (lines 1-3) records paper Series EE bonds; because paper EE bonds were sold at half face value, line 3 multiplies the total face value by 50% (.50) to get their cost.
- Part II (lines 4-5) records Series I bonds and electronic Series EE bonds, entered at full face value.
- Part III computes the interest: line 6 is total redemption proceeds (from the teller at cashing), line 7 is total cost (line 3 plus line 5), and line 8 is the total interest (line 6 minus line 7).
- Form 8818 supports the exclusion you actually claim on Form 8815; use a separate Form 8818 for each cashing event. See Pub. 550 and Pub. 970 for exclusion limits.
What is Form 8818 and who should use it
Form 8818 is the IRS’s optional worksheet titled “Optional Form To Record Redemption of Series EE and I U.S. Savings Bonds Issued After 1989.” You use it to list each bond you cashed, total the proceeds, and compute the interest portion so you can figure any education exclusion on Form 8815. You keep it in your files, and you attach Form 8815 to your Form 1040 if you qualify for the exclusion.
Use Form 8818 if any of these apply to you:
- You cashed post‑1989 EE or I bonds and need a reliable record of proceeds and interest.
- You plan to claim the Education Savings Bond Program exclusion on Form 8815 and want bond‑by‑bond details documented.
- You cashed electronic bonds in TreasuryDirect and want a printable, year‑filed snapshot of the bonds you included in your return.
If you receive a 1099‑INT, that form is still important for your return. Form 8818 does not replace reporting. It simply helps you prove what happened, by bond, and it feeds the numbers you need for Form 8815 if you qualify.
Form 8818 vs. 1099‑INT, different jobs, same facts
Think of these as two views of the same event. Form 8818 is your ledger. It records which bonds you cashed, when you cashed them, and how much interest was in those proceeds. A 1099‑INT, on the other hand, is an information return from the payer that the IRS also receives. You will usually get a 1099‑INT by January 31 for interest paid on redeemed bonds, either from your bank or from TreasuryDirect, depending on where you redeemed.
- Your job, report the interest on your tax return and keep your records.
- The payer’s job, issue a 1099‑INT when required.
- Form 8818’s job, help you compute totals and support any education exclusion on Form 8815.
If you do not receive a 1099‑INT, you still report the interest. Publication 17 and Publication 550 both make that clear. Form 8818 becomes even more useful because it is your proof of what you reported.
When to use Form 8818 for EE and I bonds
Use Form 8818 in any year you cash post‑1989 EE or I bonds and want to keep a precise record for your files, especially if you will complete Form 8815. The form totals your face values and redemption proceeds, then calculates the interest amount on line 8. That line 8 figure feeds the education exclusion calculation on Form 8815.
A quick note about annual versus at‑redemption reporting
You can either report savings bond interest each year as it accrues or wait and report it all in the year you cash or when the bond matures. If you choose annual reporting, you make that choice by reporting the interest on your tax return and you must use the same method for all EE and I bonds you own. Form 8818 does not create, record, or change that choice. If you switch methods, Publication 550 explains the rules for changing.
Bottom line, keep reporting consistent across all your EE and I bonds, and keep documentation that supports the method you use.
Recordkeeping that prevents headaches
Good records cut review time, reduce mismatches, and make IRS questions easy to answer. Use Form 8818 as your base, then layer in a simple checklist:
- List every post‑1989 EE and I bond you cashed, with serial number, issue date, face value, and total proceeds.
- Keep the teller receipt or TreasuryDirect statement that shows total proceeds.
- Compute total interest on line 8 of Form 8818, then use that number in your Form 8815 calculation if you qualify for the education exclusion.
- Store everything securely, and keep it for at least three years after filing the return that includes the interest. The IRS reminds you to keep records as long as they could matter for tax administration.
Secure digital storage, a simple setup
Create a searchable, encrypted PDF named with the tax year and your last name, for example, 8818_Bonds_2025_Smith.pdf. Keep the PDF with your 1099‑INTs, TreasuryDirect Taxable Transaction Summary, and a copy of Form 8815 if used. Use strong passwords and turn on multi‑factor authentication for your cloud account. TreasuryDirect makes your 1099‑INT available by January 31 when bonds are held there, so include that in your file.
| Control | Risk | Feeling |
| AES‑256 encryption at rest | Data theft | Relief |
| MFA on cloud accounts | Account takeover | Confidence |
| Access logs | Unauthorized viewing | Assurance |
| Retention rules | Premature deletion | Stability |
| Offline backup | Ransomware | Resilience |
Pro tip, keep one cloud backup and one offline backup, and test that your files open correctly before tax time.
Sharing with your tax professional
If a preparer files your return, send a clean packet:
- Your Form 8818 PDF, clearly named.
- Any 1099‑INTs and the TreasuryDirect Taxable Transaction Summary for the year.
- A short note that confirms whether you report bond interest annually or at redemption, so treatment is consistent on Schedule B.
Always use a secure client portal or encrypted transfer for anything with SSNs. Keep a copy of exactly what you sent, with the date you sent it.
How to complete Form 8818, step by step
You will fill out three parts. The IRS form is short, two pages, and includes specific lines for totals. There is no signature line, because you are not filing it. You keep it.
Part I, paper Series EE bonds
- List each paper EE bond issued after 1989.
- Enter the bond’s serial number, issue date, and face value.
- Add column c, face value, and enter the total on line 2.
- Multiply line 2 by 50%, which gives your cost basis for those paper EE bonds, and enter that on line 3.
Why 50 percent for older paper EE bonds, because they were sold at half their face value and accreted to full value at maturity. Do not carry that 50% multiplier into line 5; I bonds and electronic EE bonds were issued at full face value, so their cost equals face value with no discount adjustment.
Part II, Series I bonds and electronic EE bonds
- List each I bond and each electronic EE bond issued after 1989, including any post-1989 paper EE bonds you later converted to electronic in TreasuryDirect (per the Form 8818 instructions, converted EE bonds belong in Part II, not Part I).
- Enter the serial number, issue date, and face value.
- Add column c and enter that total on line 5, your cost for these bonds.
Part III, total proceeds and interest
- Enter the total redemption proceeds from all bonds you listed in Parts I and II on line 6. Use the amount from the teller or TreasuryDirect.
- Add line 3 and line 5, then enter that on line 7. This is your total cost.
- Subtract line 7 from line 6. Enter the result on line 8. That is your total interest for the bonds listed, which you will use when you figure any education exclusion on Form 8815.
Line 8 on Form 8818 is the interest amount you use to help complete Form 8815’s education exclusion calculation. Keep the form with your records.
Education exclusion, what to know
If you paid qualified higher education expenses in the same year you cashed qualified bonds, some or all of the interest may be excludable. You must meet ownership and age rules (the bond owner must have been age 24 or older before the bonds were issued – reaching age 24 by the redemption date is not enough), use the proceeds for qualified expenses such as tuition and required fees (not room and board), and clear the MAGI phaseout. You claim the exclusion on Form 8815 and attach it to your Form 1040.
The exclusion phases out over a MAGI band that is different for single filers and joint filers, and the IRS adjusts the band each year for inflation. Because the figures move annually, do not rely on a prior‑year number. Confirm the current thresholds for the tax year you are filing in Publication 970 or on the Form 8815 page before you compute the exclusion.
Special ownership situations that change who reports the interest
Ownership details drive who reports interest. Getting this right on your records avoids amended returns later.
Bonds registered to a child
If a bond is registered only in your child’s name, the interest generally belongs to the child. Note that a bond titled to a child who was under age 24 when it was issued will not qualify for the education savings bond interest exclusion, by either the parent or the child, even if the parent paid for it and the proceeds later fund the child’s tuition. You can choose to have the child report interest each year or at redemption, but the method must be consistent across all of the child’s bonds. If the bond was issued in the child’s name and you paid for it, the interest is still the child’s. Publication 550 explains these rules and how to change methods.
Co‑owners and community property
If you and another person each paid part of the purchase price, each generally reports a share of the interest based on what each paid. If you live in a community property state and hold bonds as community property, one‑half of the interest is considered received by each spouse. Publication 550 provides examples that illustrate both situations.
Inherited bonds
For inherited bonds, whether interest before death is reported on the decedent’s final return or by the heir depends on choices the executor makes and on the method the decedent used. Interest after death is generally reported by the person who receives the bond. Publication 550 walks through common inheritance examples.
Custodial accounts, UGMA or UTMA
When a minor is the owner under UGMA or UTMA and a custodian acts on their behalf, list the child’s name and SSN as the owner on your record. The custodian can prepare the file, but the tax ownership remains with the child. Publication 17 and Publication 550 give context on when income is taxable to the child.
Common mistakes and how to avoid them
Most Form 8818 errors trace back to one of five recurring patterns. They show up in cleanup files year after year because the form has not been revised since December 2007 and clients rarely read the instructions before cashing.
A quick walkthrough, using real numbers
Say you cashed these bonds in 2025, two paper EE bonds, face values $500 each, and one I bond, face value $1,000. The teller paid you $2,260 total for all three.
- Part I, list each paper EE bond with serial, issue date, and face value, then add face value and enter $1,000 on line 2. Multiply by 50%, enter $500 on line 3.
- Part II, list the I bond and enter its face value $1,000 on line 5.
- Part III, enter $2,260 on line 6, add line 3 and line 5 to get $1,500 on line 7, then subtract to get $760 on line 8. The $760 is the interest for these bonds, which you may partly exclude on Form 8815 if you meet the education rules and income limits for your filing year.
If you intend to claim the education exclusion, check the current year’s MAGI thresholds in Publication 970 or on the Form 8815 page before you file, since the IRS updates them periodically.
Where Accountably fits, only if you need help
Accountably is an offshore accounting and tax staffing company built for CPA, EA, and accounting firms, and Form 8818 is one of those tasks that benefits from simple SOPs, predictable checklists, and secure file handling. We build the discipline around documentation, naming, and review so bond redemptions, education exclusions, and supporting workpapers are consistent, easy to review, and audit‑ready. Trained U.S.-led offshore teams work inside your systems and templates, with quality checks that shorten review time and keep records clean. Use us lightly or seasonally, only where structure and capacity move the needle.
Compliance notes and helpful sources
- IRS, About Form 8818, last reviewed January 2026, confirms that the form is optional, kept for your records, and supports Form 8815.
- IRS Form 8818 PDF, Rev. December 2007, shows the exact lines and totals, including the instruction to keep the form for your records and not to send it to the IRS.
- IRS, About Form 8815 and Publication 970, explain the Education Savings Bond Program rules and the MAGI phaseout, which the IRS updates periodically.
- IRS Publication 550 and IRS FAQs explain when and how to report savings bond interest and how the annual‑interest method works.
- TreasuryDirect explains how and when 1099‑INTs are made available for bonds in TreasuryDirect accounts.
Conclusion
You do not file Form 8818, you keep it. Fill it out whenever you cash post‑1989 EE and I bonds, total the proceeds, compute the interest on line 8, and then use that number to help complete Form 8815 if you qualify for the education exclusion. Pair your Form 8818 with any 1099‑INTs, TreasuryDirect statements, and a short note about your reporting method, annual versus at redemption. That little bit of structure keeps your return accurate and your audit risk low.
Reusable Checklists
These three checklists are copy-paste ready for an SOP folder. Each item maps to a step a preparer can verify before the redemption file leaves the desk.
Pre-redemption qualification packet
- Confirm each bond's issue date is after 1989 (printed on the face of paper bonds; issue-date column in TreasuryDirect).
- Verify the bond owner was at least age 24 before the issue date.
- Confirm titling: sole taxpayer, or jointly with spouse if married; bonds in a child's name (under 24) do not qualify.
- Sort bonds into three buckets: paper EE, electronic EE, Series I.
- Pull every serial number, issue date, and face value into a single working sheet.
- Separate any pre-1990 bonds for a different cashing event so the line-6 redemption total stays clean.
Line-by-line entry review
- Top of form: taxpayer name and the date the bonds were cashed.
- Part I, line 1: each paper EE bond on its own row with serial number, issue date, and face value.
- Line 2: total of column (c) from line 1.
- Line 3: line 2 multiplied by .50 (paper EE cost basis).
- Part II, line 4: each Series I bond and electronic EE bond on its own row.
- Line 5: total of column (c) from line 4 (no multiplier).
- Line 6: redemption proceeds from the teller's printed total or the TreasuryDirect statement, not estimated from face value.
- Line 7: line 3 plus line 5.
- Line 8: line 6 minus line 7 (potentially excludible interest).
Education exclusion handoff to Form 8815
- Confirm qualified higher-education expenses cover tuition and fees only; exclude room and board.
- Add any 529 plan or Coverdell ESA contributions to the qualified-expense total.
- Verify the student is the taxpayer, spouse, or tax dependent (grandchildren who are not dependents do not qualify).
- Pull current-year MAGI phaseout thresholds from IRS Publication 970 for the filing year.
- Carry line 8 from Form 8818 into the Form 8815 calculation worksheet.
- File Form 8815 with the Form 1040; keep Form 8818 in the client's records and do not attach it.
- Retain Form 8818 with the workpapers for at least three years (per IRS recordkeeping guidance).
Keep 8818 Season From Stalling
Form 8818 is a small worksheet but a stubborn one. The bonds are decades old, the form has not been revised since December 2007 (per IRS Form 8818 instructions, Rev. December 2007), and the issue-date, owner-age, and bond-type rules each disqualify a different slice of the inventory. When a client walks in with a shoebox of EE and I bonds the week before tuition is due, the preparer is reconstructing redemption histories under time pressure, not running a clean SOP.
The fix is to treat each redemption event as its own packet, with the qualifying tests run before the bonds are cashed and the line-by-line entries scripted to match Parts I, II, and III. Once that discipline lands in the workpaper template, the same engagement that used to take a senior reviewer an hour of back-and-forth becomes a short desk review.
- Separate paper EE bonds (Part I, line 3 × .50) from Series I and electronic EE bonds (Part II, line 5 at face value) before any data entry, because the cost-basis math is different and mixing them overstates line 8.
- Capture the teller's printed redemption total on line 6 the same day the bonds are cashed; estimating from face value misstates the interest figure on line 8.
- Verify the age-24-at-issuance test for the bond owner before listing a bond at all, because a single disqualified bond muddies the exclusion calculation on Form 8815.
- Route TreasuryDirect bonds and converted-from-paper electronic EE bonds to line 4 in Part II, not line 1 in Part I, regardless of how the bond originated.
- Complete one Form 8818 per cashing event; do not consolidate multiple redemption dates onto a single form (per IRS Form 8818 instructions, Rev. December 2007).
This is the kind of low-volume, high-attention work that benefits from a documented SOP and a second reviewer who has seen the same patterns before. Accountably's offshore tax preparation teams build the redemption packet, run the issuance and age checks, and hand back a clean Form 8818 plus the Form 8815 worksheet so partner review is a short signoff rather than a half-day reconstruction.
FAQs
Do I file Form 8818 with my tax return?
No. Form 8818 is optional and for your records only. The IRS provides it to help you compute interest and complete Form 8815 if you qualify for the education exclusion. Keep it in your files.
What is the difference between Form 8818 and Form 8815?
Form 8818 is your internal record of which bonds you cashed and how much interest they earned. Form 8815 is filed with your return to claim the Education Savings Bond Program exclusion if you qualify. Use Form 8818’s totals to help complete Form 8815.
I did not get a 1099‑INT. Can I still report the interest?
Yes. You must report all taxable interest even without a 1099‑INT. You can use Form 8818 and your bank or TreasuryDirect records to support the amount. Publication 17 explains that you must report interest even when no 1099‑INT arrives.
Where do I find my 1099‑INT for TreasuryDirect bonds?
Log in to TreasuryDirect, go to ManageDirect, choose the tax year, then open the 1099‑INT. It is available by January 31 for the prior year.
Does Form 8818 let me choose annual reporting of bond interest?
No. The annual‑interest choice is made on your return and must be applied consistently across all your EE and I bonds. Publication 550 explains how to choose annual reporting and how to change methods later.
How long should I keep Form 8818?
Keep it with your tax records for at least three years after the return that includes the related interest. The IRS also advises keeping books or records as long as they may be material to any tax administration matter.