I Bonds in a qualified plan

[bvhea]

I have a client with both a cash balance and 401(k) that would like to invest part of each plan's assets in I bonds. Is this a permitted investment for a qualified plan?

[Lou S.]

 I Bonds are not available in qualified plans or IRAs.

[bvhea]

Lou, thanks for the reply. Can you point me to any published guidance on this?

[Bird]

Interesting; I am getting both "yes you can" and "no you can't" answers from Dr. google.  None of the "authorities" have cites.  Actually I think you can.

"...the U.S. Treasury rules say you can’t open an account to buy savings bonds electronically through Treasury Direct in the name of an IRA."  My emphasis on IRA but I imagine a plan cannot do that either.  But that doesn't mean you can't buy them at all.  I have a client who has owned some for many years so will follow this carefully!

[Lou S.]

I would guess the definitive answer would be Treasury Direct. https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds_ibuy.htm

The answer on the website for

Trusts and Estates is: "In some cases yes".

Corporations, partnerships, other entities: "No"

[Peter Gulia]

That website’s information seems to distinguish between electronic and paper bonds, and suggest a simpler Yes for electronic bonds.

https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds_ibuy.htm#who

And the website furnishes these points of further information:

https://www.treasurydirect.gov/indiv/help/TDHelp/help_ug_292-EntityAccountsLearnMore.htm

https://www.treasurydirect.gov/indiv/help/TDHelp/help_ug_292-EntityAccountsLearnMore.htm#Trust

I have not considered the accuracy, completeness, or appropriateness of any of this information.