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Payroll Deduction Offers State Employees an Easy Way to Buy U.S. Savings Bonds
(CHARLESTON) -- Worried about your money during this troubling financial time?
Consider participating in the U.S. Savings Bonds program offered to state employees. Payroll deduction makes it easy.
Savings bonds may not offer gigantic returns, but they are backed by the full faith and credit of the U.S. government and may give you peace of mind in the long run.
Issued by the U.S. Treasury, savings bonds pay varying rates, which often are affected by general economic conditions. The bonds are exempt from state and local taxes upon redemption. Taxes on the earned interest can be deferred until the bond is redeemed. There are additional tax benefits if bond redemptions are used for education expenses.
The state employee savings bond program offers two payroll deduction opportunities:
---The standard savings bond available for purchase through payroll deductions is the EE Bond. It earns a fixed rate of return and is sold at half of its face value. EE Bonds are guaranteed by the U.S. Treasury to reach full face value in 20 years. EE Bonds will continue to earn interest for up to 30 years after the date of issue.
---The newer I Bond has an interest rate that carries a fixed rate of return but also adjusts to the nation’s inflation rate. I Bonds, sold at face value, also earn interest for up to 30 years after the date of issue.
Participating employees may choose to direct a minimum of $25 per paycheck, which at month’s end would purchase either one $100 EE Bond or one $50 I Bond, to be mailed by the U.S. Treasury. The annual purchase limit is $5,000 for each bond per person, based on Social Security number. The maximum number of payees can be only two individuals. The bonds may be registered as single-owner, co-owners or one owner/one beneficiary.
Remember, some restrictions apply. You may not cash in a bond until at least one year after the date of issue. Also, you’ll lose three month’s interest if you cash in your bond within the first five years.
For more information about buying U.S. Savings Bonds, contact your agency’s human resources administrator. You may download the participation form by visiting www.wvsao.gov/epicspayroll.
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