According to a press release, the Treasury will no longer sell paper U.S. savings bonds through banks and other financial institutions as of January 1, 2012. You can still buy electronic savings bonds through TreasuryDirect.gov.
I didn’t see any news regarding the purchase limits changing. The annual purchase limit is currently $5,000 in paper bonds and $5,000 in online bonds per Social Security Number. However, with the disappearance of paper bonds this would seem to cut the overall limit in half starting in 2012. There does seem to be a small loophole in the press release:
Series I paper savings bonds remain available for purchase using part or all of one’s tax refund. For more information on this feature, visit www.irs.gov.
Does this mean I should intentionally overpay my taxes by $5,000 this year, so I can buy an extra $5k in savings bonds in 2012? If there is continued inflation and low interest rates, Series I bonds could continue to be a good deal. They currently offer 4.60% interest for 6 months, plus an yet-to-be determined amount for the next 6 months. Even if that later rate is zero, you could still earn over 2.5% annualized over the next 11 months. For more details, see the rest of my posts on savings bonds.