Treasury Inflation-Protected Securities (TIPS)
Treasury Inflation-Protected Securities, or TIPS, provide protection against inflation. The principal of a TIPS increases with inflation and decreases with deflation, as measured by the Consumer Price Index. When a TIPS matures, you are paid the adjusted principal or original principal, whichever is greater.
TIPS pay interest twice a year, at a fixed rate. The rate is applied to the adjusted principal; so, like the principal, interest payments rise with inflation and fall with deflation.
You can buy TIPS from us in TreasuryDirect and Legacy Treasury Direct through non-competitive bidding. Starting in January 2007, the 20-year TIPS is no longer sold in Legacy Treasury Direct, but it continues to be available in TreasuryDirect.
Effective April 2009, TreasuryDirect permits accounts for both individuals and various types of entities including trusts, estates, corporations, partnerships, etc. See Learn More about Entity Accounts for full information on the new registration types.
To compare the features of TreasuryDirect and Legacy Treasury Direct, see My Accounts.
You also can purchase TIPS through banks and brokers through either competitive or non-competitive bidding.
- Learn more in "TIPS in Depth"
- Buy TIPS in TreasuryDirect
- Buy TIPS in Legacy Treasury Direct
- Compare TIPS with I Bonds
Use TIPS to:
- Diversify your investment portfolio
- Supplement retirement income
 | |
| Original Issue Rate: | The yield determined at auction. See rates in recent auctions |
| Minimum purchase: | $100 |
| Maximum Purchase (in a single auction): |
Non-competitive: $5 million Competitive: 35% of offering amount (See types of bidding in "Auctions in Depth") |
| Investment Increment: | Multiples of $100 |
| Issue Method: | Electronic |
 | |
Rates & Terms
- TIPS are issued in terms of 5, 10, and 20 years. The 20-year TIPS is no longer sold in Legacy Treasury Direct, but it continues to be available in TreasuryDirect.
- TIPS Inflation Index Ratios can be used to easily calculate the inflation adjustment to principal on previously issued TIPS.
- TIPS can be held until maturity or sold before maturity.
Redemption Information
- Minimum Term of Ownership: None
- Interest Earning Period: To maturity
Tax Considerations
- Interest income and growth in principal are exempt from state and local income taxes.
- Interest income and growth in principal are subject to federal income tax.
TIPS-Related FAQs
- What happens to TIPS if deflation occurs?
- What are the maturity terms for TIPS?
- How do I know when TIPS will be auctioned?
Want e-mail notification of auction results and upcoming auctions? Sign up for our mailing list.
