Treasury Bill vs Money Market Yield 2027 Calculator
Interest on Treasury bills is subject to federal income tax but not to state or local income tax. This calculator compares a T-bill with a money market fund after state tax, using the yields and the state tax rate you enter. It contains no market data: the yields in the boxes are placeholders, so replace them with today's quotes.
State Tax Treatment
TreasuryDirect states that for Treasury bills there is federal tax due on the interest earned and no state or local taxes. IRS Publication 550 confirms that interest on U.S. Treasury bills, notes and bonds is taxable for federal income tax purposes. Income from an ordinary money market fund is generally taxable by your state as well, which is why a T-bill with a slightly lower yield can still pay more after tax.
How the Comparison Works
T-bill after state tax = amount × T-bill yield. Money market after state tax = amount × money market yield × (1 − state rate). Example: $100,000, T-bill 5.05%, money market 5.15%, state rate 9% → $5,050 against $4,686.50, a difference of $363.50. The break-even T-bill yield is the money market yield × (1 − state rate).
T-Bill Terms
The Treasury sells bills for terms from four weeks to 52 weeks: 4, 6, 8, 13, 17, 26 and 52 weeks. Bills of up to 26 weeks are auctioned weekly and 52-week bills every four weeks. The comparison here annualises both yields and ignores reinvestment timing.
Source and Disclaimer
No yields are built in — the figures in the boxes are placeholders. Results are an estimate for comparison only and are not investment or tax advice.
Source: TreasuryDirect — Treasury Bills; IRS Publication 550. Last updated: October 2026.