No more using your tax refund to buy Savings Bonds - program discontinued

Tax professional here. You're absolutely right - the IRS did discontinue the option to purchase US Savings Bonds with your tax refund. This program was eliminated officially at the beginning of 2024. The Treasury Department made this decision based on declining usage of the program over recent years. They determined that maintaining the infrastructure for this service wasn't cost-effective given how few taxpayers were taking advantage of it. Only a small percentage of filers were using this option annually. If you still want to purchase savings bonds, you'll need to do so directly through TreasuryDirect.gov instead. The process isn't too complicated - you create an account, link your bank account, and can purchase electronic savings bonds there. While it does require the extra step of transferring your refund to your bank first, the TreasuryDirect platform offers more options and flexibility than the tax refund method ever did.

After struggling to figure out why I couldn't find the savings bond option on my tax return this year, I found a really helpful tool called taxr.ai (https://taxr.ai) that explained the whole situation. I uploaded my old return where I had purchased bonds and it immediately identified that this was no longer an option and explained the alternatives. The tool actually walked me through setting up a TreasuryDirect account and showed me how to schedule purchases that would mimic what I was doing with my tax refund before. Way easier than piecing together info from different IRS pages that kept giving me outdated information.

Just wanted to follow up - I decided to try taxr.ai after asking about it and it's been incredibly helpful. I was struggling with some confusing forms since I worked in multiple states this year, and it immediately identified issues with how I was handling the state tax credits. The nicest thing is that it actually pulls information from my previous returns and uses that context to give personalized advice. Saved me from making a mistake that would have cost about $400 in overpaid taxes. Definitely more useful than just for the savings bonds issue!

If you're still trying to contact the IRS to ask about alternatives to the savings bond program, good luck getting through on their phone lines! After waiting on hold for almost 2 hours trying to get clarification, I found this service called Claimyr (https://claimyr.com) that got me connected to an actual IRS agent in about 20 minutes. They have a video that shows how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed everything about the savings bond program ending, but also told me about some alternative programs I hadn't heard about that might work better for me anyway. Apparently there are some state-based savings programs that offer better returns than the federal savings bonds did.

I have to admit I was wrong about Claimyr. After seeing it mentioned here, I was super skeptical and said it sounded like a scam. But after waiting on hold with the IRS for 3+ hours and getting disconnected twice trying to sort out some issues with my refund, I gave it a shot out of desperation. It actually worked exactly as advertised - I got a call back when an agent was available, and I was able to talk to someone who helped resolve my issue. The agent also confirmed that the savings bond program was discontinued permanently, not just temporarily. Saved me hours of frustration, and now I can focus on finding alternatives for investing my refund.

Here's what I'm doing instead of the savings bonds program - I'm setting up an automatic transfer of 30% of my refund to a high-yield savings account as soon as it hits my bank. The current rates are actually better than what the Series I bonds were offering anyway (at least the fixed rate portion). Then once I hit $1000, I'll manually buy bonds through TreasuryDirect if rates look good. The automatic transfer accomplishes the same "forced savings" effect that the tax refund bond purchase did. Out of sight, out of mind.

Does anyone remember when you could actually get paper savings bonds with your tax refund? I miss those days. My grandparents gave me paper bonds when I was a kid, and I liked continuing that tradition with my own kids using the tax refund option. Now everything's electronic and it just doesn't feel the same.