How are taxes figured on cashed savings bonds that are inheritance money?
She has savings bonds with both their names on them. She would like to not have to pay huge tax penalties for cashing the savings bonds. She is 73 years old and on a fixed income.
As long as she is still alive, if you cash them, it's her income.
If you wait until after she dies, then it's inherited and you pay tax on the interest income (unless the executor includes the interest in her final return).
(The accumulated interest is income to somebody. You can't get around that.)
