Updated October 27, 2026 from live rates

Where to keep cash in Maryland

Maryland’s top income tax rate is 6.50%. 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 $14 in a default brokerage sweep. A CD or savings account would need to pay 5.02% 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%

$6,568

Treasury-only money fund

3.79%

$5,969

Marcus by Goldman Sachs 11-month No-Penalty CD

4.00%

$5,650

Wealthfront Cash Account

3.55%

$5,014

Municipal money fund (not your state's)

1.45%

$3,389

Merrill Edge

0.01%

$14

Why Treasuries win in Maryland

Savings accounts, CDs and most money funds pay interest that Maryland taxes at up to 6.50%. Treasury bills don’t. So a Treasury bill paying 4.50% keeps what a fully taxable account paying 5.02% would, for a top-bracket Maryland resident. Today the best 1-year CD we track pays 4.65% and the best savings account 3.55%.

Municipal money funds in Maryland

We don’t list a money fund that holds only Maryland municipal debt. A national municipal fund is free of federal tax but generally taxed by Maryland; for a top-bracket resident it needs at least 3.03% to beat a 1-year Treasury bill.

Maryland taxes on cash, in brief

Top income tax rate: 6.50%. 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 Maryland, except the share of a fund’s income that comes from U.S. Treasuries.
Some Maryland cities or counties also levy a local income tax. Where it covers interest, Treasuries are exempt from it too, which widens their edge.

Questions

Is Treasury bill interest taxed in Maryland?

No. Interest on U.S. Treasury bills, notes and bonds is exempt from state and local income tax under federal law, so Maryland doesn’t tax it. It is still subject to federal income tax. Interest from savings accounts and CDs is taxed by Maryland at up to 6.50%.

Where should I keep cash in Maryland?

At Maryland’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 Maryland?

At Maryland’s top rate and 37% federal, a CD or savings account needs at least 5.02% 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 →