Updated October 23, 2026 from live rates
Treasury bills vs high-yield savings: which keeps more after tax?
At today's rates, 3-month T-bill keeps more after tax in all 9 tax scenarios below, by about $2,110 to $4,197 a year on $500,000.
After-tax yield by tax situation
Yield you keep after federal and state income tax, at today's rates. The last column is the yearly gap between the best and second-best on $500,000. The 3.8% net investment income tax is left out; it lowers every taxable option by the same share.
| Federal bracket, state tax | 3-month T-bill | Best savings | Yearly gap |
|---|---|---|---|
| 24%, no state tax | 3.21% | 2.70% | $2,546 |
| 24%, 5% state | 3.21% | 2.52% | $3,434 |
| 24%, 9.3% state | 3.21% | 2.37% | $4,197 |
| 32%, no state tax | 2.87% | 2.41% | $2,278 |
| 32%, 5% state | 2.87% | 2.24% | $3,166 |
| 32%, 9.3% state | 2.87% | 2.08% | $3,929 |
| 37%, no state tax | 2.66% | 2.24% | $2,110 |
| 37%, 5% state | 2.66% | 2.06% | $2,998 |
| 37%, 9.3% state | 2.66% | 1.91% | $3,761 |
What's different
| 3-month T-bill | Best savings | |
|---|---|---|
| What it is | 3-month Treasury billBought at auction or in your brokerage, held to maturity | Wealthfront Cash AccountHigh-yield savings |
| Rate today | 4.22%Par yield, held to maturityVerified October 23, 2026 | 3.55%Base rate; promo: New clients get +0.65% for 3 months on up to $150,000Verified October 23, 2026 |
| Getting your money | Matures in 3 months; can be sold any day at market price | 1 to 2 business days to move |
| Protection | Backed by the U.S. government | FDIC: Up to $8M through program banks |
| State income tax | Exempt | Fully taxable |
Savings rates can change any day; a T-bill's rate is fixed until it matures. T-bill interest is exempt from state income tax, savings interest isn't. Savings is simpler to move in and out of; a T-bill sold before maturity gets the market price that day.
Cash intelligence
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Every business day we re-check every rate against your balance and tax settings. You hear from us only when something changes what you'd keep.
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