1. What is the US Treasury I Bond Calculator?

The US Treasury I Bond Calculator estimates the current value of Series I savings bonds based on the purchase amount, fixed rate, semiannual inflation rate, and holding period. I Bonds are inflation-protected securities issued by the US Treasury.

2. How Does the Calculator Work?

The calculator uses the I Bond value formula:

Where:

• \( V \) — Current value of the bond (USD)
• \( P \) — Purchase amount (USD)
• \( fixed \) — Fixed annual interest rate (decimal)
• \( inflation \) — Semiannual inflation rate (decimal)
• \( y \) — Number of years held

Explanation: The formula combines the fixed rate with inflation adjustments compounded semiannually over the holding period.

3. Importance of I Bond Value Calculation

Details: Accurate I Bond valuation helps investors track their inflation-protected investments, plan for future expenses, and make informed decisions about holding or redeeming bonds.

4. Using the Calculator

Tips: Enter the purchase amount in USD, fixed rate and inflation rate as decimals (e.g., 0.025 for 2.5%), and years held. All values must be non-negative.

5. Frequently Asked Questions (FAQ)

Q1: What are US Treasury I Bonds?
A: I Bonds are savings bonds that earn interest based on both a fixed rate and an inflation rate, providing protection against inflation.

Q2: How often do inflation rates change?
A: Inflation rates for I Bonds are adjusted every six months (May and November) based on the Consumer Price Index.

Q3: What is the minimum holding period for I Bonds?
A: I Bonds must be held for at least one year, and there's a penalty of three months' interest if redeemed before five years.

Q4: Are there purchase limits for I Bonds?
A: Yes, individuals can purchase up to $15,000 in I Bonds per calendar year ($10,000 electronic + $5,000 paper via tax refund).

Q5: How are I Bonds taxed?
A: I Bond interest is exempt from state and local taxes but subject to federal income tax. Tax can be deferred until redemption.