Form 8888: Split Your Tax Refund Between Direct Deposits & Bonds

Jan 25, 2011
Carol Finch

Use Form 8888 to Split Your Tax Refund From the IRS - Photo by czbalazs

Taxpayers can direct the IRS to split tax refunds between direct deposits, U.S. savings bonds, and checks by submitting Form 8888. What are your options?

The IRS added a new way to use your refund in 2010. Now, in addition to requesting a paper check or direct deposits into various accounts, you can also save some of your cash into U.S. savings bonds. You will, however, need to submit Form 8888 when you file your return to tell the agency what to do with your money. What options are on offer and how do they work?

What is Form 8888?

Titled, "Allocation of Refund (including Savings Bond Purchases)" this is the form to use if you want to split your refund into multiple accounts or want to use savings bonds or paper check options. It needs to be sent when you file and can be used with a 1040, 1040A, 1040EZ, 1040NR, 1040 NR-EZ, 1040-SS, and 1040-PR. You can use this form to divide your cash across different accounts of the same type or into different types of accounts.

Using IRS Form 8888 to Split Tax Refunds

This form allows you to split your refund three different ways (savings/checking accounts, U.S. savings bonds, and paper checks). This could be useful if you want to invest some of your money, but would also like part of it to be immediately accessible. Your options on the form are:

Part I: This deals with checking and savings accounts (up to three) across up to three U.S. financial institutions. This could also be used to deposit into IRAs, HSAs, ESAs, or an Archer MSA. You'll need to enter your routing and account numbers as well as the amounts you want deposited. Keep in mind that some institutions won't allow you to deposit joint refund money into an individual account and you may want to check first.
Part II: You need to complete this section if you want to use some of your refund to buy U.S. Series I savings bonds (up to three registrations within the allotted allowance of $5,000). An existing account with the Treasury or a bank account isn't needed for this option. Although you can opt to use some/all of your cash to buy bonds, they have to be purchased in increments of $50. You can buy for yourself, on a co-ownership basis, and/or for another person (i.e. child or grandchild).
Part III: This section is for paper checks. Simply fill in the amount that you want mailed to you.

Form 8888 is available to download on the IRS website. Keep in mind that this is not the form to use if you simply want your refund paid by direct deposit in full. You can request that option on your regular filing form.