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Use Your Tax Refund to Buy U.S. Savings Bonds

Share the wealth as a gift to a loved one

En español | When you file your 2010 tax return, you'll be able to turn refund money into U.S. savings bonds and share the wealth as a gift to a loved one.

The Series I bonds, which you can also buy for yourself, are sold in increments of $50 and delivered by mail in paper form. To buy them, include Form 8888 with your tax return.

Interest will accrue at an inflation-adjusted rate that will reset every six months. Bonds bought between now and the April 15 filing deadline will pay 0.74 percent.

Generally the bonds must be held for at least a year, but after that the owner can redeem them, with forfeiture of three months' interest if less than five years have passed. For more information, check the instructions for Forms 1040 and 8888.

Savings bonds are a big part of the national debt — currently there are close to $190 billion worth outstanding.

John Burgess, a former reporter and editor at the Washington Post is an associate editor at the AARP Bulletin.

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