US Savings Bond Interest- Inherited Bond

I don't believe this question has been answered in previous topics. Mother has EE bond purchased in her name for $ 100---it has not matured- she dies when the bond has 200 accrued interest---she has not elected to report the interest each year. The son is the sole beneficiary of the will . He inherits the bond and the 200 is not reported on mothers final return or the fiduciary. A couple of years pass and the bond matures worth 500. Does the son report the 500 in year of maturity. In other words is the 200 deferred until son cashes on maturity? Publication 550 -if the decedent uses the cash method interest before death and after is reported when the bond matures. If there are multiple beneficiaries does the will have to name the beneficiary the the specific bond to the person.

https://www.irs.gov/publications/p559#e ... k100099601

That answers most of your questions. I'm not sure a tax forum is the best place to ask your final question, "[i]f there are multiple beneficiaries does the will have to name the beneficiary the the specific bond to the person". Personally I would just ask the client who inherited what bond, and if they don't know I would refer them to the estate administrator or to an attorney.

Your citation is what I was referring to ---It would seem that most estates would advise the beneficiary to take the bond & report all the interest when it matures or when it is cashed ---some of the I bonds maturing in the 30s have an interest @4 1/2%---considering tax deferred- great investment---could it then be willed to the grandson if the son died before the maturing date?

https://www.treasurydirect.gov/indiv/re ... edeath.htm

This link addresses beneficiaries.

How about the election to include the interest income from the bonds in the year of death on the decedents final return?
See Rev Rul 68-145, 1968-1 CB 203. That way the bene only picks up the income from date of death to redemption date.

Your citation is what I was referring to

Then you should read it a bit more carefully. It answers the question you asked about how the son reports the income from the bond.