What are the best CD rates in New Jersey right now?

As of May 2026, the best CD rates available to New Jersey residents reach approximately 4.50%–4.75% APY at online banks including Ally, Marcus, and Discover Bank. New Jersey also has several strong regional banks and credit unions, including Investors Bank (now part of Citizens Bank) and Columbia Bank. Rates change frequently — verify before opening.

Is CD interest taxable in New Jersey?

Yes. New Jersey taxes CD interest as ordinary income at progressive rates from 1.4% to 10.75%. Most NJ residents in middle income brackets pay 3.5%–6.37% state income tax on CD interest. For higher-income NJ residents, state tax on CD interest can be substantial, making Treasury bills (exempt from NJ state tax) a meaningful alternative.

Are Treasury bills better than CDs for New Jersey residents?

Treasury bill interest is exempt from New Jersey state income tax. For NJ residents in the 6.37%+ state bracket, a T-bill at 4.35% APY may produce a higher after-tax yield than a CD at 4.65% APY. The higher your NJ income, the stronger the case for T-bills over CDs. Compare after-tax yields before choosing.

What major banks are headquartered in New Jersey?

While most large US banks are not NJ-headquartered, New Jersey has several notable regional institutions. Columbia Bank (Fair Lawn-based) and Provident Bank are well-known NJ community banks. Lakeland Bank is another NJ-based option. Many NJ residents also use New York-area institutions given proximity to the NYC metro banking market.

What is the New Jersey income tax rate on CD interest for middle-income earners?

New Jersey's income tax rates for 2026 include: 1.4% on income up to $20,000; 1.75% on $20,001–$35,000; 3.5% on $35,001–$40,000; 5.525% on $40,001–$75,000; 6.37% on $75,001–$500,000; 8.97% on $500,001–$1,000,000; and 10.75% on income over $1,000,000. Most NJ residents with moderate CD interest income will fall in the 3.5%–6.37% range.

New Jersey CD Rates 2026 — Best CDs Available to NJ Residents

New Jersey residents face one of the higher state income tax burdens in the US on CD interest — 1.4% to 10.75% in 2026. The best CD rates available to NJ residents reach 4.75% APY through FDIC-insured online banks, but the state’s high tax rates mean that Treasury bills (exempt from NJ state income tax) are worth comparing carefully.

Rates shown are as of May 2026 and change frequently. Verify current rates directly with the institution before opening.

Best CD Rates Available to New Jersey Residents (May 2026)

Institution	Type	12-Month APY	Min. Deposit
Online banks (Ally, Marcus, Discover, CIT)	Online	4.50–4.75%	$0–$2,500
Columbia Bank	NJ community bank	3.75–4.25%	$1,000
Provident Bank	NJ community bank	3.75–4.25%	$1,000
Garden State Federal Credit Union	NJ credit union	3.75–4.25%	$500
Traditional big banks	National bank	0.01–1.00%	$1,000+

New Jersey State Income Tax on CD Interest (2026)

NJ Taxable Income	State Rate
$0–$20,000	1.4%
$20,001–$35,000	1.75%
$35,001–$40,000	3.5%
$40,001–$75,000	5.525%
$75,001–$500,000	6.37%
$500,001–$1,000,000	8.97%
Over $1,000,000	10.75%

After-tax yield on a 4.65% CD for a typical NJ resident (22% fed + 6.37% NJ):

Total marginal rate: ~28.37%
After-tax yield: ~3.33%

T-Bills vs. CDs for New Jersey Residents

Treasury bill interest is exempt from New Jersey state income tax.

	12-Month CD	12-Month T-Bill
Gross yield	4.65%	4.35%
Federal taxable	Yes	Yes
NJ state taxable (6.37%)	Yes	No
After-tax yield (22% fed + 6.37% NJ)	~3.33%	~3.39%

At 6.37% state tax, the T-bill’s lower gross yield results in a marginally higher after-tax yield than the CD. For NJ residents in the 8.97%+ bracket, the T-bill advantage widens significantly.

What $10,000 Earns at Top Available NJ Rates

Term	APY	Gross Interest	After-Tax (22% fed + 6.37% NJ)
6 months	4.40%	~$219	~$157
12 months	4.65%	~$465	~$333
2 years	4.10%	~$838	~$600

Notable New Jersey Options

Columbia Bank — Fair Lawn-based NJ community bank; competitive CD rates for NJ/northern NJ area customers
Provident Bank — Jersey City-based; branch network across NJ with competitive relationship rates
Lakeland Bank — Oak Ridge-based; northern NJ community bank

For most NJ residents, online banks and T-bills (especially for higher-income earners) provide better returns than NJ community bank CDs.

Written by WealthVieu

WealthVieu researches and writes data-driven personal finance guides using primary sources including the IRS, Bureau of Labor Statistics, Federal Reserve, and Census Bureau.

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