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Hi All,

Back again with another question regarding financial matters. This time its about Premium Bonds.

I recently discovered to my surprise that I hold some Premium Bonds. Not many, five pounds worth to be exact. Apparently they were bought for me
not long after I was born, so have had them for many years. I have btw never won anything.

I have now however received a letter to my US address from NS&I telling me that I need to cash in the bonds. The letter says that due to US lottery laws I am not able to hold them as a resident of the US. I do vaguely recall hearing or reading something about this in the past, so did some searching around on the net, including some threads here which discussed this same matter. So now, my understanding after doing a bit more reading is that it may not actually be illegal to hold the bonds, but any type of correspondence regarding the bonds via the US mail service is. Is this correct?

I dont care about keeping the bonds, and am happy to cash them in, however, I am not sure exactly how to go about this. NS&I sent me a form to fill in, with a return envelope. But doing this means I'm breaking the law if I am understanding correctly. Surely they know that. Anyway, even if I was able to get the form to them, then how would they pay me? I would have to have a crossed warrant sent. Not quite sure what that is, they say it's like a cheque, but would they send it here to the US, and even if they did, could I even legally deposit it in my account?

It's only a fivers worth so barely even worth the bother. Really, it's going to cost me more than its worth to do this. I suppose I could call them and tell them to cash me out and they can keep the money, but somehow I dont think they will do that.

Does anyone here have any experience of this? Any advice on how to proceed? Thanks.


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lansbury

I believe you are correct it is the correspondence about the bonds that is the problem, not holding the bonds themselves.

Two solutions, register the bonds to a family members address in the UK, or cash them out. I agree for the amount cashing them out isn’t going to result in very much ending up in your pocket.

A thought if you are minded to do so, can you donate them to a charity in the UK. If that is possible at least someone gets the benefit rather than just writing them off.

robin1234

I have premium bonds dating back to 1957, then in the early 1970s I bought a few more but my holding was less than £100. They were always registered at my parents address. My mother died in 2006 and in fact the house was demolished and the street number disappeared as several new houses were built on the site. Now that I have an English address again (I spend half my time in the UK,) I set up an online account with NS&I and in fact bought some more bonds. When I set up my online account, there were no questions about citizenship or tax responsibilities in other countries.

Without doing too much research, I believe there are two potential dodgy areas for US Persons who hold premium bonds. One, using US mail (easily avoided with a UK address.) Two, winning a prize, because you'd then have to declare it as income on your IRS tax return.

I agree, they should have an easy option for people to donate their holdings to a designated charity. My mother and father both died and we took no action to recover, identify, or notify NS&I about their premium bond holdings. My parents also bought small amounts for my kids back in the 1980s, and the paperwork for them is lost in the shuffle ...

durham_lad

As per the letter the op received I believe that being a US citizen is not a problem but the fact that he lives in the USA.

I would think that receiving correspondence or winnings is not allowed in the US mail but surely receiving back the cashed in proceeds is okay since that is simply a return of principal as it is only the bond’s interest that is the stake money.

Changing the name of the bond holder is a good idea to avoid any possible issues.

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Yes, I think I am just going to get rid of them.

Do you think it would be ok to send the form back to them via the mail since
I am just cashing out, or would that still be considered illegal?

I am not sure how else to go about it otherwise. I am guessing Fedex or similar is also not an option since its still going by mail.

durham_lad

I would send in the form by mail, I don’t see the form meeting the prohibited devices list.

https://about.usps.com/publications/...cted-items.htm