CD Calculator
Interest at maturity, early withdrawal cost and after-tax yield
Last updated: October 2026 · Default rates are examples: enter the rates you are offered
Your CD
Months of interest
0 = hold to maturity
Taxes and alternatives
Investment rate from TreasuryDirect
Breaking the CD early
Penalty: 3 months of interest = $251.15. Interest earned covers the penalty from month 3. Before that, an early withdrawal returns less than you deposited.
Enter a month before maturity above to see what an early withdrawal would pay.
After-tax comparison over 12 months
| Option | After-tax yield | Interest kept |
|---|---|---|
| This CD Federal and state tax | 2.99% | $748.25 |
| High-yield savings Federal and state tax, rate assumed unchanged | 2.77% | $693.50 |
| Treasury bill Federal tax only, rolled at the same yield | 3.12% | $780.00 |
Because Treasury interest is free of state tax, a CD needs 4.27% APY to match this T-bill after tax.
How this CD calculator works
Interest at maturity. The deposit grows by the APY for each year of the term: value = deposit x (1 + APY)months / 12. If you enter an interest rate instead, it is converted to an APY with APY = (1 + rate / n)n - 1, where n is the number of compounding periods a year.
Early withdrawal. Most banks set the penalty as a number of months of interest on the amount withdrawn at the CD's rate. The calculator uses that method. Some banks use days of interest or a percentage of principal instead, so check your account disclosure.
After tax. CD and savings interest are taxed at your federal bracket plus your state rate. Treasury bill interest is taxed federally only. Yields are multiplied by what you keep: 1 minus the tax rates that apply.
Worked example
You put $25,000 in a 12-month CD at 4.10% APY. You are in the 22% federal bracket and pay 5% state income tax.
- Interest at maturity: $25,000 x 4.10% = $1,025.00. You get back $26,025.00.
- After 27% combined tax you keep $748.25, an after-tax yield of 2.99%.
- A 4.00% T-bill taxed only federally keeps $780.00, more than the higher-rate CD.
- Break the CD at month 6 with a 3-month penalty: you earned $507.35, pay $251.15, and keep $256.20.
Frequently Asked Questions
How is CD interest calculated?
Banks quote an APY, which already includes compounding. The value at maturity is deposit x (1 + APY)^(months / 12). $10,000 in a 12-month CD at 4.00% APY earns $400.00. Over 18 months at the same APY it earns $605.96. If the bank quotes only an interest rate (APR), the calculator converts it: 4.00% compounded monthly is a 4.074% APY.
How much is the early withdrawal penalty on a CD?
It is set by each bank and disclosed in the account agreement, usually as a number of months of interest: often around 3 months on terms of a year or less and 6 to 12 months or more on longer terms. On $25,000 at 4.10% APY, 3 months of interest is about $251.15. Withdraw in the first few months and the penalty can be larger than the interest earned, so you get back less than you deposited.
Is CD interest taxable?
Yes. CD interest is ordinary income for federal tax and, in states with an income tax, for state tax too. It is generally taxed in the year it is credited. For a CD longer than one year that pays everything at maturity, you still report a share of the interest each year, and the bank reports it on Form 1099-INT or 1099-OID. Interest on a CD held inside an IRA is not taxed until you withdraw it (or ever, in a Roth IRA, if the rules are met).
Are Treasury bills better than CDs after tax?
They can be in high-tax states. Treasury bill interest is subject to federal income tax but exempt from state and local income tax. With a 22% federal bracket and a 5% state tax, a 4.00% T-bill keeps 3.12% after tax, while a CD needs about 4.27% to keep the same amount. In a state with no income tax the rates compare directly.
CD or high-yield savings account?
A CD locks in a rate for the term, which protects you if rates fall, but costs a penalty if you need the money early. A high-yield savings account can change its rate at any time but lets you withdraw freely. Keep your emergency fund in savings and use CDs, or a CD ladder, for money with a known date.
Are CDs insured?
CDs at FDIC-insured banks are covered up to $250,000 per depositor, per insured bank, for each account ownership category. Credit union share certificates are covered by the NCUA on the same basis. Brokered CDs are insured by the issuing bank, not the brokerage.