I would like to purchase paper I bonds for my 16 year old for her college fund.
Her only income for 2011 would be if I used the accrual method and reported the interest on the I-bonds I bought for her in 2011. It's not enough to require filing.
Can I make an estimated payment of $5000, file a tax return declaring the savings bond interest, and then take the tax refund in an additional $5000 savings bond for her.
Basically is there anything wrong with making extra estimated tax payments to increase the refund in order to get savings bonds?