Are you in line to receive a tax refund ? Were you hoping to have received more of your hard earned money back into your bank account? As of 2010, there is an automatic way to invest your tax refund into government U.S. Series I Savings Bonds. This is a great way to increase your refund by earning interest, as well as a convenient way to ensure your money ends up working for you instead of being spent.
Bond Purchasing Limits
For all bond purchases automatically made with your tax refund, you must purchase US Savings bonds in multiples of $50, and the most you can request is $5,000 worth. The bonds will be issued in your name, unless you file a joint return, in which case the bonds will be issued in both you and your partners’ name. Please note that you cannot designate a beneficiary under this option.
Split Your Refund Deposits: Form 8888
As in previous tax years, you can choose to split your refund up into several accounts, including the following: savings account, checking account, a retirement fund, a health savings account, and/or a Coverdell education savings account by using Form 8888: Direct Deposit of Refund to More Than One Account . This year you can also choose to split your refund between these accounts and U.S. Series I Savings Bonds, or put your entire refund into purchasing these treasury bonds. Most likely you will need this form to do so (see below).
How to Purchase
If you are using your entire tax refund to purchase bonds, and it meets the criteria (at least $50, in multiples of $50, and no more than $5,000), then you do not need to fill out Form 8888. Instead, you would enter the information below on the appropriate lines on your tax return.
If, however, your tax refund needs to be split up, then you need to use Form 8888 to do so. For example, if your refund is $1,680, you could purchase $1,650 in bonds, but then would need to deposit the $30 into another financial institution, thus requiring the use of Form 8888.
You can use TurboTax  to help you fill out the form. On Form 8888, fill in a dollar amount in line 1a, 2a, or 3a (depending on how many ways you are splitting your return deposit), the routing number(s) on line 1b, 2b, or 3b, and the account number(s) on line 1d, 2d, or 3d. Check whether or not each account is ‘checking’ or ‘savings’. For the line where you want to purchase the bonds, enter the dollar amount in line 1a, 2a, or 3a (remember the bond purchasing limits above when figuring out how much to put on these lines). For the routing number, enter the following: 043736881. Enter the word BONDS on line 1d, 2d, or 3d, and check the box ‘savings’.
You will receive the bonds in the mail. However, if you make a mistake, you will receive your refund as a check from the IRS instead.
Update: After the end of paper savings bonds , using your tax refund is currently the only way to purchase paper savings bonds.