Thanks to the magic of bond-premium amortization, that maneuver reduces your taxable interest income over the life of the bonds.

FORBES: Sidestepping Taxes

Effective October 1, 2002, for intragovernmental investments with the Bureau of the Public Debt (BPD), BPD and trading partner agencies will use the interest method for amortization on market-based notes, bonds, and zero-coupon bond securities.

WHITEHOUSE: M-03-01, Business Rules for Intragovernmental Transactions, Attachment B | The White House