Updated October 27, 2026 from live rates

Where to keep cash in Rhode Island

Rhode Island’s top income tax rate is 5.99%. 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 4.97% 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%

$6,627

Treasury-only money fund

3.79%

$5,969

Marcus by Goldman Sachs 11-month No-Penalty CD

4.00%

$5,701

Wealthfront Cash Account

3.55%

$5,060

Municipal money fund (not your state's)

1.45%

$3,408

Merrill Edge

0.01%

$14

Why Treasuries win in Rhode Island

Savings accounts, CDs and most money funds pay interest that Rhode Island taxes at up to 5.99%. Treasury bills don’t. So a Treasury bill paying 4.50% keeps what a fully taxable account paying 4.97% would, for a top-bracket Rhode Island resident. Today the best 1-year CD we track pays 4.65% and the best savings account 3.55%.

Municipal money funds in Rhode Island

We don’t list a money fund that holds only Rhode Island municipal debt. A national municipal fund is free of federal tax but generally taxed by Rhode Island; for a top-bracket resident it needs at least 3.02% to beat a 1-year Treasury bill.

Rhode Island taxes on cash, in brief

Top income tax rate: 5.99%. 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 Rhode Island, except the share of a fund’s income that comes from U.S. Treasuries.

Questions

Is Treasury bill interest taxed in Rhode Island?

No. Interest on U.S. Treasury bills, notes and bonds is exempt from state and local income tax under federal law, so Rhode Island doesn’t tax it. It is still subject to federal income tax. Interest from savings accounts and CDs is taxed by Rhode Island at up to 5.99%.

Where should I keep cash in Rhode Island?

At Rhode Island’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 Rhode Island?

At Rhode Island’s top rate and 37% federal, a CD or savings account needs at least 4.97% 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 →