Retirement & Savings

What Is a Treasury Bill (T-Bill)?

A Treasury bill (T-bill) is a short-term US government debt security with a maturity of one year or less. T-bills are sold at a discount to their face value and pay the full face value at maturity; the difference is the investor’s interest. They are considered among the lowest-risk investments.

Example

Buying a 1,000 T-bill for 980 and receiving 1,000 at maturity earns 20 in interest.

Taxes

Interest is subject to federal income tax but exempt from state and local income taxes.

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🔗 Related Terms

Treasury Bond I Bond (Series I Savings Bond) Money Market Fund Bond

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Last updated: September 29, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.