Updated October 27, 2026 from live rates

Where to keep cash in Hawaii

Hawaii’s top income tax rate is 11.00%. At that rate and 37% federal, a 1-year Treasury bill at 4.50% keeps the most: about $7,088 a year on $250,000 after tax, versus $13 in a default brokerage sweep. A CD or savings account would need to pay 5.45% to keep as much as a 1-year Treasury bill at 4.50%.

Option

Rate

Kept a year on $250,000

1-year Treasury bill

4.50%

$7,088

3-month Treasury bill

4.22%

$6,647

CFG Bank 1-year CD

4.65%

$6,045

Treasury-only money fund

3.79%

$5,969

Marcus by Goldman Sachs 11-month No-Penalty CD

4.00%

$5,200

Wealthfront Cash Account

3.55%

$4,615

Municipal money fund (not your state's)

1.45%

$3,226

Merrill Edge

0.01%

$13

Why Treasuries win in Hawaii

Savings accounts, CDs and most money funds pay interest that Hawaii taxes at up to 11.00%. Treasury bills don’t. So a Treasury bill paying 4.50% keeps what a fully taxable account paying 5.45% would, for a top-bracket Hawaii resident. Today the best 1-year CD we track pays 4.65% and the best savings account 3.55%.

Municipal money funds in Hawaii

We don’t list a money fund that holds only Hawaii municipal debt. A national municipal fund is free of federal tax but generally taxed by Hawaii; for a top-bracket resident it needs at least 3.19% to beat a 1-year Treasury bill.

Hawaii taxes on cash, in brief

Top income tax rate: 11.00%. Your own rate may be lower; change it above.
Interest on U.S. Treasury bills, notes and bonds: exempt from state and local income tax, taxed federally.
Savings accounts, CDs and prime or government money funds: taxed by Hawaii, except the share of a fund’s income that comes from U.S. Treasuries.

Questions

Is Treasury bill interest taxed in Hawaii?

No. Interest on U.S. Treasury bills, notes and bonds is exempt from state and local income tax under federal law, so Hawaii doesn’t tax it. It is still subject to federal income tax. Interest from savings accounts and CDs is taxed by Hawaii at up to 11.00%.

Where should I keep cash in Hawaii?

At Hawaii’s top rate and 37% federal, a 1-year Treasury bill keeps the most after tax today (4.50%). The answer depends on your brackets; the calculator on this page updates for yours.

What rate does a CD need to beat Treasury bills in Hawaii?

At Hawaii’s top rate and 37% federal, a CD or savings account needs at least 5.45% to keep as much as a 1-year Treasury bill paying 4.50%.

Rates: each provider’s own page and the U.S. Treasury, October 27, 2026. State rates: Tax Foundation, 2026 (top single-filer rate; local taxes not included). General information, not tax advice. Other states →