What are the best CD rates in Pennsylvania right now?

As of May 2026, the best CD rates available to Pennsylvania residents reach approximately 4.50%–4.75% APY at online banks including Ally, Marcus, and Discover Bank. Pennsylvania credit unions and community banks — including PSECU (Pennsylvania State Employees Credit Union) — offer competitive rates as well. Rates change frequently; verify before opening.

Is CD interest taxable in Pennsylvania?

Yes. Pennsylvania imposes a flat 3.07% state income tax on all income, including CD interest. This is one of the lower flat state income tax rates in the US. Combined with the 22% federal bracket, a typical PA resident pays approximately 25% total marginal tax on CD interest.

Are there good Pennsylvania-based banks and credit unions for CDs?

Yes. Notable Pennsylvania options include PSECU (Pennsylvania State Employees Credit Union), open to PA state employees and family members; Mid Penn Bank, a community bank with competitive rates in central PA; and numerous local community banks across the state. PNC Bank is headquartered in Pittsburgh and offers standard and occasional promotional CD rates.

Does Pennsylvania tax retirement account CD interest differently?

Pennsylvania does not tax retirement income (including IRA and 401(k) distributions) for residents who are 59½ or older. However, CD interest earned outside of retirement accounts is fully taxable at 3.07% regardless of age. If you hold CDs inside an IRA, the interest grows tax-deferred (traditional IRA) or tax-free (Roth IRA) — the 3.07% state tax applies only to non-retirement CD interest in the year it's earned.

What is the early withdrawal penalty on a Pennsylvania CD?

Early withdrawal penalties are set by each bank, not by Pennsylvania state law. Typical penalties range from 60 to 180 days of interest depending on the term. Penalties are the same for PA residents as for any other state. Confirm the specific penalty with your bank before opening.

Pennsylvania CD Rates 2026 — Best CDs for PA Residents

Pennsylvania residents pay a flat 3.07% state income tax on CD interest — one of the lower state rates in the US. The best CD rates available to PA residents reach 4.75% APY in May 2026 through FDIC-insured online banks, with strong local options including PSECU and a variety of community banks.

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

Best CD Rates Available to Pennsylvania Residents (May 2026)

Institution	Type	12-Month APY	Min. Deposit
Online banks (Ally, Marcus, Discover, CIT)	Online	4.50–4.75%	$0–$2,500
PSECU	PA credit union	4.00–4.50%	$500
Mid Penn Bank	PA community bank	3.75–4.25%	$1,000
PNC Bank (standard)	National bank	0.05–1.00%	$1,000
PNC Bank (Special CD)	National bank	4.00–4.50%+ when avail.	$1,000
Traditional big banks	National bank	0.01–0.50%	$1,000+

Pennsylvania State Income Tax on CD Interest

Pennsylvania has a flat 3.07% income tax rate on all income, including CD interest. This applies to all PA residents regardless of income level.

After-tax yield on a 4.65% APY CD for a PA resident (22% federal bracket):

Federal tax: 22%
PA state tax: 3.07%
Total marginal rate: ~25.07%
After-tax yield: ~3.48%

What $10,000 Earns at Top Available PA Rates

Term	APY	Gross Interest	After-Tax (22% fed + 3.07% PA)
6 months	4.40%	~$219	~$164
12 months	4.65%	~$465	~$348
2 years	4.10%	~$838	~$627

Notable Pennsylvania Institutions

PSECU — Pennsylvania State Employees Credit Union; open to PA state employees, public school employees, and their family members; competitive certificate rates
Mid Penn Bank — Millersburg-based community bank with central PA footprint; consistently competitive CD rates
First Keystone Financial — Smaller community institution in Montgomery County
Univest Financial — Southeast PA community bank; competitive rates for relationship customers

PNC Bank is headquartered in Pittsburgh and is the dominant traditional bank in PA. Standard PNC CD rates are low, but their Special CDs can be competitive when available.

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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