T-bill vs CD: state-tax-equivalent yields
Treasury bill interest is exempt from state and local income tax; CD interest usually is not.
This table shows the CD rate needed to match each bill's latest auction yield after state tax, rebuilt from official data on every refresh.
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U.S. Treasury securities: not FDIC-insured · not bank deposits · market value can change before maturity
| Bill (latest auction) | Investment rate | CD-equivalent at 3% state tax | CD-equivalent at 7% state tax | FDIC national avg CD |
|---|---|---|---|---|
| 4-Week bill (Oct 15, 2026) | 4.068% | 4.19% | 4.37% | 1 month CD: 0.23% |
| 13-Week bill (Oct 13, 2026) | 4.185% | 4.31% | 4.50% | 3 month CD: 1.14% |
| 26-Week bill (Oct 13, 2026) | 4.351% | 4.49% | 4.68% | 6 month CD: 1.39% |
| 52-Week bill (Sep 29, 2026) | 4.616% | 4.76% | 4.96% | 12 month CD: 1.76% |
Tax-equivalent yield = bill investment rate / (1 − state tax rate). Bill yields: U.S. Treasury Fiscal Data. CD column: Source: FDIC, National Rates and Rate Caps, Oct 19, 2026, retrieved 2026-10-21 20:40 CDT. National rates are deposit-weighted averages across insured institutions and credit unions computed by the FDIC; savings and interest checking use the $2,500 tier, money market and CDs average the $10,000 and $100,000 tiers. They are averages, not offers from any institution. Change is in percentage points. The rate cap applies to banks that are less than well capitalized. Illustration only; state tax rates shown are examples, not your rate.
How to read it
Find your state's top marginal income-tax rate (your state revenue department publishes it). If a CD offered to you pays less than the CD-equivalent figure in that column, the bill paid more after state tax at its last auction, before considering liquidity, penalties or reinvestment. Federal tax applies to both and is left out.
Related: upcoming Treasury auctions and latest results · FDIC national CD and savings rates · weekly issues
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Frequently asked questions
Why compare Treasury bills and CDs after state tax?
Interest on Treasury bills is exempt from state and local income tax under federal law (31 U.S.C. 3124); CD interest generally is not. In a state with an income tax, a bill's yield can be worth more than the same CD rate. Federal income tax applies to both.
What does the tax-equivalent yield mean here?
It is the CD rate that would leave the same after-state-tax interest as the Treasury bill, computed as bill yield divided by (1 minus the state tax rate). It ignores deductions, local taxes, compounding differences and fees.
Which Treasury yield is used?
The investment rate (bond-equivalent yield) at the most recent auction for each bill term, from the U.S. Treasury Fiscal Data API. Prices and yields in the secondary market change daily.
Is this personalized guidance?
No. It is arithmetic on published averages. Your own tax situation, the rates actually offered to you, early-withdrawal penalties and liquidity all matter; consider a tax professional for your specifics.