Many Series E war bonds issued in the 1940s and early '50s have reached their 40-year maturity and stopped earning interest, so cash them in. But be prepared for a tax blow, says Cleland Noret, a Modesto (Calif.) enrolled agent (licensed to represent individuals before the IRS). A bond purchased in 1954 for $750 is worth more than $7,000. The $6,337 gain is taxable as ordinary income on federal returns.
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