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Solved

Interest from Schwab U.S. Treasury Money Funds: Free from Oregon State Tax

Forum|Forum|3 years ago
December 16, 2022
2 replies
0 views

We are in Oregon and we receive interest from two Schwab funds that invest in "securities backed by the full faith and credit of the U.S. government." Since US Treasury Bills, Notes, TIPS are not subject to state tax, we assume that the interest from these two funds is also tax free.

The two funds are SWRSX (Schwab Treasury Inflation Protected Securities Index Fund) and SUTXX (Schwab U.S. Treasury Money Fund)

Can anyone verify the state tax free status of these Schwab funds?

Best answer by Anonymous_

Ask Schwab.

Interest from obligations of the U.S. government are exempt from state income taxation. Dividends from funds holding such securities may not be.

Anonymous_Answer

Employee

Ask Schwab.

Interest from obligations of the U.S. government are exempt from state income taxation. Dividends from funds holding such securities may not be.

Employee

what does Schwab say ?

Employee

Q. what does Schwab say ?

A. Shareholders are urged to consult their tax advisors as to the consequences of these and other state and local tax rules

Some clarification: If you hold funds from SWVXX (Schwab Value Advantage Money Investor Shares)

which holds "securities" (read "not treasury bonds), then these are treated as ordinary dividend income.

I have SWVXX, and I checked, the funds are taxed by both Federal and the state of Oregon.