Don't savings bonds pass tax-free to heirs?

Q. In your column in the Money section on Sunday, you stated that if one held E or EE bonds that had matured until death, it was "sticking your  beneficiaries with the tax bill".   Don't E or EE bonds passed on  to beneficiaries get stepped-up basis and the accrued interest is therefore not taxed to benefciaries?'

A. No. Savings bonds do not get a stepped-up tax basis at death. Tax-deferred investments such as IRAs, annuities and savings bonds do not get a stepped-up basis at death. The beneficiary owes income taxes the same way the original owner would have owed them.