T-Bills
Terry,
Please consider these T-Bill questions. If I purchase a T-Bill at 4%, and keep it to maturity, is there any way that I would receive less than 4%?
Are all T-Bills (4 weeks or 52 weeks) taxed as ordinary income?
Thank you so much for all the help.
Terry Says
When you purchase a Tbill, say for $10,000 you will notice that they take slightly less out of your checking account. The difference is your interest, which is paid up-front. If you automatically renew your T-bill at maturity, they will drop the next interest directly into your account, and so on.
But if you don’t renew, the full $10,000 will go right back to your account!
The interest you receive is taxed at the Federal level as ordinary income. You’ll receive a 1099from Treasury for the total of interest paid. There is no state tax on T-bill interest
