Start with one question and one time period
Decide what you are comparing before collecting rates. A common question is: “If I leave this balance in each eligible cash option for 12 months, how much estimated income will remain after the taxes and fees I expect to pay?” That wording forces every option onto the same balance, horizon and tax assumptions. It also avoids treating a changing yield as a promise.
Use the same starting balance and holding period for every product. Keep future deposits and withdrawals out of the first pass. If cash will move during the period, run a few separate scenarios rather than hiding that uncertainty inside one precise-looking result.
Put APY and seven-day yield on comparable footing
A bank savings APY already includes compounding over one year. A money market mutual fund usually publishes a seven-day yield: an annualized measure based on a recent seven-day period. The two percentages answer different questions. Subtracting one from the other does not tell you the dollar difference you would earn.
For a savings APY, Cash After Tax converts the annual figure to the selected number of months. For a fund yield, it models monthly reinvestment at a constant rate. Holding either rate constant is an estimate, not a prediction. The value of the method is consistency: every option is projected over the same balance and time period.
Example: if two products both display 4.00%, their projections can still differ slightly because an APY and a seven-day yield encode compounding differently. Taxes, fees and eligibility can create much larger differences.
Separate gross income from taxable income
Calculate gross projected income first. Then determine which fraction is taxable for each tax. Federal, state, local and net investment income tax do not always use the same taxable fraction.
Ordinary savings interest is generally modeled as federally and state taxable. A government money market fund may report that part of its annual income came from eligible U.S. government obligations. That percentage can reduce state-taxable income where state rules allow it. The fund name alone is not evidence for the percentage.
Municipal fund distributions require another split. Qualified exempt-interest dividends may avoid regular federal income tax, while taxable distributions do not. State treatment can depend on the obligations held, the annual allocation and state-specific rules. A “California” or “New York” label is a research clue, not proof that every distribution receives every exemption.
Use annual tax documents, not portfolio guesses
Issuer tax supplements are the practical source for the income percentages used on a return. A portfolio can change during the year, and a list of current holdings does not establish the final tax character of distributions. This site uses the issuers’ 2025 tax documents as clearly labeled proxies until 2026 documents are available.
California, Connecticut and New York can impose fund-level requirements in addition to the government-income percentage. The model keeps the qualification flag separate from the percentage. This prevents a high Treasury fraction from being treated as an exemption where the issuer says the fund did not qualify.
If a material distribution split is unknown, a range is more honest than a point estimate. Cash After Tax shows mathematical bounds for affected municipal funds and leaves them out of the ranking. The high end of a range is a boundary, not a claim that the exemption applies.
Subtract only the fees that change
Quoted money market yields already reflect the fund’s expenses and any waivers included in the published yield. Subtracting the expense ratio again would count the same cost twice. Account fees, transaction fees and subscription costs need separate treatment when they actually change because of the option.
For Robinhood Gold cash, this site subtracts the $5 monthly subscription when the user does not already pay for Gold. If the subscription is already being kept for another reason, the incremental cost for this comparison is zero. That distinction matters most at smaller balances, where a fixed fee consumes a larger share of the projected income.
Check whether the product is actually usable
A return comparison is useful only if the product is available in the relevant account and can meet the reader’s cash needs. Confirm the correct share class, minimum investment, purchase eligibility, settlement behavior, redemption timing and any transaction fee at the brokerage where the cash will be held.
A fund listed by its issuer is not automatically available without a fee at another brokerage. A settlement fund can behave differently from a purchased fund. A bank sweep, a bank savings account and a money market mutual fund can also have different insurance, liquidity and risk terms even when all three appear in a “cash” menu.
Money market mutual funds are investments, can lose value and are not FDIC insured. Bank deposit insurance depends on the institution, ownership category and applicable limits. Confirm current terms with the provider before moving money.
Read the result as a sensitivity test
The highest estimate is the highest among the eligible products with enough verified inputs for that scenario. It is not a recommendation, a guaranteed return or proof that every available product was included. A close result should be treated as fragile: a rate change, different tax treatment or a fee can reverse the order.
Run at least three cases when the decision matters: your best current estimate, a lower yield for the leading product, and a tax case with no state exemption. The comparison is more useful when it shows what would have to change for the answer to change.
The HYSA break-even APY provides another check. It answers: “What savings APY would produce the same estimated after-tax dollars as this product under these assumptions?” That threshold is easier to use than a small projected dollar lead when shopping for an account.
A practical review checklist
- Choose one balance and one holding period.
- Record each rate, rate type, source and source date.
- Confirm the exact product, share class and platform access.
- Use the issuer’s annual tax supplement for income fractions.
- Apply federal, state, local and NIIT assumptions separately.
- Subtract only incremental fees.
- Exclude or bound results with missing material inputs.
- Test a lower-rate and lower-exemption case.
- Confirm current terms before acting.
Frequently asked questions
Is a seven-day yield the same as APY?
No. APY includes compounding over a year. A seven-day yield annualizes a recent income period. Project both over the same horizon instead of subtracting the headline rates.
Does Treasury income automatically avoid state tax?
No. The eligible fraction varies by fund and year, and some states impose additional qualification rules. Use the issuer’s annual supplement and the rules that apply to your state.
Is a money market fund FDIC insured?
No. It is an investment, not a bank deposit. Review the fund’s risk and liquidity terms. Bank savings and deposit money market accounts are different products.
Continue the comparison
Run your own numbers, then read the full formulas and source policy. The coverage page identifies what the current dataset can and cannot verify. Product-specific examples are collected in the guide library.