DQOTD: 52 week T-Bill does not pay interest annually like longer duration Treasuries?

Midpack

Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Joined
Jan 21, 2008
Messages
21,349
Location
NC
I just bought some 52 week T-Bills in my taxable account - to push the interest into next year, and allow more Roth conversions this year. Just want to make sure what I've read that T-Bills do NOT pay any interest until they mature. As I understand it, treasury notes and bonds pay interest annually. Just making sure so I don't get a 2023 1099 for partial interest on a 52 wk T-Bill.
 
The 52 week T-bill is a zero coupon bond, as are all T-bills. They pay no coupon. They are sold at a discount and pay face value at maturity. The difference between what you pay at at purchase and what you redeem at maturity is the interest. Thus no interest is received until the maturity date.

Anything greater than 52 weeks pays a coupon at least annually.

FWIW 52 weeks is 1 or 2 days shy of a full year.
 
Last edited:
Back
Top Bottom