Q. I have owned Winn-Dixie stock for years and realize it is in for hard times. I read about a possible stock buyback and that there was another buyback last fall. I never heard of that and was not informed by Winn-Dixie that such a buyback took place. Will the company contact present shareholders so they may have a chance to sell their stock?
A. When a company buys back its own shares, it usually purchases them on the open market at the prevailing price. This is what Winn-Dixie is doing. In its press release, the grocery chain said it will "use its discretion on the timing of purchases based on open market conditions and available funds."
I can assure you that Winn-Dixie was not trying to keep these buybacks a secret. Companies typically announce buybacks in an effort to boost a sagging share price. The directors want to tell the world that they consider the stock undervalued. The hope is that investors will take a look at the stock and buy some shares themselves. Winn-Dixie's buybacks were announced in news releases that are available on the company's Web site (http://www.winn-dixie.com).
Of course you are free to sell your stock any time the stock market is open. To do so, you will need to open an account with a brokerage firm if you do not have one.
Q. I have savings bonds I purchased through payroll deduction from 1974 to 1979 in my name with my husband as beneficiary. He died two years ago. I am 78. I think I should exchange the E bonds, because they no longer earn interest, for H bonds, if they are still available, or Treasuries, which I was told are tax-free in Florida. How can I do this? I have a revocable trust with my four children as beneficiaries. Can savings bonds or Treasuries be part of the revocable trust with each of my children as beneficiaries on the bonds or notes?
A. Whoa! I am afraid you have several issues confused.
The good news is that your E bonds still are earning tax-deferred interest of 4 percent to 6 percent. Bonds issued since December 1965 pay interest for 30 years, while earlier bonds paid for 40 years. The rate that applies to a savings bond depends on when it was issued.
The problem with exchanging E bonds for HH bonds is that HH bonds pay 4 percent interest. The deadline for making an exchange, which allows you to continue deferring taxes on the E bonds' accumulated interest, is 12 months after an E or EE bond reaches its 30-year maturity. I see no reason for you to make the exchange before your bonds have matured, and you may not want to do it then.
Treasury bonds can be purchased directly from the Treasury as well as through a broker, but right now they yield less than CDs. Although Treasuries and CDs are exempt from the Florida intangibles tax, the interest they pay is subject to federal income tax.
If you want a Treasury bond or savings bond to be part of your trust, you must title the investment in the name of the trust. To make your trust the owner of your savings bonds, you need to fill out Form PDF 1851. You could change the beneficiary on each bond from your late husband to one of your grandchildren, but then it would not be part of your trust.
Q. I read that you can give $500 to a grandchild for college education, but I don't know where to show the deduction on a 1040 form. I'd like more information about how to do this.
A. You are thinking of the Education IRA. The investment earnings are tax-free if they are used to pay certain college expenses. The contributions are not deductible, which is why you find no place to record them on Form 1040.
Online money map
Want to know how much your savings bonds are worth, when they stop earning interest and what interest rate they are earning now? Get the answers using a great new calculator on the savings bond Web site (http://www.savingsbonds.gov). One of its best features is that you can save the list of your bonds as an html file on your computer, then update it with a click of the mouse any time you are connected to the Internet.
_ Helen Huntley writes about investing and markets for the Times. If you have a question about investments or personal finance, send it to On Money. We'll try to answer those we think are of greatest reader interest. All questions must be submitted in writing, but readers' names will not be published. Send questions to Helen Huntley, Times, P.O. Box 1121, St. Petersburg, FL 33731, or to huntleysptimes.com by e-mail.