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The Treasury Department and the IRS have joined forces to allow you the ability to buy Series I Bonds directly with your tax refund<\/a>. Series I bonds are thirty-year bonds that accrue interest based on a fixed rate, associated with the time you buy the bond and never changes, and an inflation rate, which changes every May and November.<\/p>\n How do you buy the bonds?<\/strong> Fill out IRS Form 8888<\/a>, Direct Deposit of Refund to More Than One Account, and put 043736881 as the routing number and BONDS<\/strong> as the account number. If your refund is in exact multiples of $50, you don’t need Form 8888, just put those details directly into your tax return.<\/p>\n Your bonds will be paper certificates and will arrive three weeks after your return is processed.<\/p>\n How is the interest rate calculated?<\/strong> The interest rate of the bond is calculated using a composite rate made up of the bond’s fixed rate and a floating inflation rate. You can use this Series I bond interest rate calculator<\/a>, which includes the equation, to calculate the interest rate.<\/p>\n As of this writing, the fixed rate is 0.30%, the inflation rate is 1.53%, so Series I bonds bought today would yield around 3.365%.<\/p>\n Is this a good idea?<\/strong> I think Series I bonds can be a good investment but being able to buy them directly offers no significant advantage. You can buy Series I bonds just by visiting your bank and there is no sales fee or commission.<\/p>\n You can learn more by reading the Treasury Direct FAQ<\/a> on using your income tax refund to buy Series I savings bonds. Also, this page gives you all the details on Series I bonds<\/a>.<\/p>\n