The Treasury Department is experimenting with a streamlined method of delivering Series EE bonds to walk-in buyers. In the past, if you walked in to your local financial institution to buy a savings bond, you waited for the application to be processed and the bond to be hand-delivered. On Oct. 1 a pilot bond-by-mail project was started in Ohio.

If the test is successful and is expanded nationwide, you will still go to your institution to complete the application and pay for the bond. The bank will then forward your order to a bond service center at one of the Federal Reserve banks, where the bond will be issued and mailed to you.

Your bond will earn interest from the month in which you place your order. This new system will affect only walk-in purchases, and will not change the procedures in use for payroll savings plans or bond redemptions.

I am a 60-year-old prospective retiree from the federal government who has contributed $75,000 to my retirement fund. If I elect a lump sum payment, I understand the government will withhold taxes from my payment averaged over a life expectancy of 18 years, although I paid taxes already on that money. Further, as a 35-year diabetic, no doctor or insurance company would allow me that life expectancy. I can't get a clear, unequivocal answer on the tax treatment I can expect. Can you give one?

You will not get special tax treatment because of your diabetes. The life expectancy tables are built on the basis of a large population of all kinds of people; if exceptions were made for those who appear to have a shorter life expectancy, it would destroy the integrity of the premise.

Although the amount you can withdraw is derived from the total of your contributions, tax law requires that you split that lump sum into taxable and nontaxable segments. The split is based on the ratio of your total contributions to the total amount of anticipated retirement payments, which in turn is the product of your initial payment times your life expectancy.

That ratio is then applied to the lump sum payment, and tax withheld (according to the Form W-4 you file) from the taxable segment of the lump sum. The same ratio is applied to your monthly retirement check to determine how much of those payments is taxable and how much a nontaxable return of your contributions.

You must keep track of the accumulating total of nontaxable payments. When the total is equal to total contributions ($75,000 in your case), all future retirement payments are taxable in full. I hope you fool all the doctors and insurance companies and go all the way. Good luck.

In your column Sept. 7, there is a question regarding owner-financing of a beach house that had been used as rental property. You said that each of the monthly payments the seller receives will have a capital gain element. Would this hold even if the property had not been used as rental property? It is my understanding that in selling an unoccupied tract of land, the seller reports all the gain at one time -- when the sale is made and the seller receives a mortgage to be paid off over a period of years. Do I misunderstand?

The rules for reporting installment sales by individuals are the same regardless of the type of property sold. (Rules for dealers are a little more involved.) There are two different questions involved here. The IRS explanation you refer to deals with determining the amount of gain realized on the sale. For that purpose, you include cash plus the value of any notes or mortgages and any other property you receive.

You need the total gain to establish the ratio between gain and return of investment on subsequent payments. But determining the gain doesn't mean that the total must be reported as income at the time of sale. If at least one payment will be received in a subsequent year, you are eligible for installment reporting -- meaning that you pay tax on a proportionate amount of gain for only the payments actually received in any tax year.Abramson is a family financial counselor and tax adviser. Questions of general interest on tax matters, insurance, investments, estate planning and other matters of family finances will be answered in this column. Advice cannot be given on an individual basis. Address questions to E.M. Abramson, the Washington Post, Business News, 1150 15th Street NWE, Washington, D.C. 20071