State tax exempt money market funds: Fidelity, Vanguard, Schwab and four Treasury ETFs, from 100% to 0% for 2025
How much of a fund's dividends escapes state income tax depends on two figures its sponsor publishes every year: the share of its income that came from U.S. government obligations, and whether it met the test that California, Connecticut and New York apply, at least 50% of its assets in those obligations at the end of each quarter. For 2025 the twelve funds below run from 100% (Vanguard Treasury Money Market Fund, VUSXX) to 0% (Schwab Prime Advantage Money Fund, SWVXX), and eight of the twelve met the 50% test.
- Fidelity: Treasury Only (FDLXX) 98.67% and met the test. Treasury (FZFXX) 61.52% and Government (SPAXX) 50.90% both missed it, so they are fully taxable in California, Connecticut and New York. Fidelity's footnote for those funds: “This fund did not meet the minimum investment in U.S. government securities required to exempt the distribution from tax in California, Connecticut, and New York.” More on SPAXX and state tax.
- Vanguard: Treasury (VUSXX) 100.00% and Federal (VMFXX, Vanguard's settlement fund) 66.61%. Vanguard marks both as a fund that “meets the threshold requirements for California, Connecticut, and New York”.
- Schwab: U.S. Treasury (SNSXX) 99.99%, marked as meeting the test; Government (SNVXX) 36.20%, not marked; Prime Advantage (SWVXX), a prime fund that Schwab's table leaves out, which it says means 0% of its dividends came from U.S. government obligations.
- Treasury ETFs: TFLO 99.21%, BIL 97.26%, SGOV 95.14% and SHV 89.80%, all meeting the test. iShares' footnote: “At least 50% of the assets of the fund were invested in Federal Obligations at the end of each quarter of the fiscal year.” State Street lists no state for BIL in its column “Threshold Requirements For Passthrough of Interest from Federal Obligations Not Satisfied (Indicate by State)”. More on SGOV and state tax.
The twelve funds, 2025
| Fund | Sponsor | U.S. government share, 2025 | Met the 50% test (CA, CT, NY) | Yield we used |
|---|---|---|---|---|
| VUSXX Vanguard Treasury Money Market Fund | Vanguard Money market fund | 100.00% | Yes | 7-day 3.80% (Sept. 30) |
| SNSXX Schwab U.S. Treasury Money Fund | Schwab Money market fund | 99.99% | Yes | 7-day 3.53% (Sept. 30) |
| TFLO iShares Treasury Floating Rate Bond ETF | iShares ETF | 99.21% | Yes | 30-day SEC 3.83% (Sept. 29) |
| FDLXX Fidelity Treasury Only Money Market Fund | Fidelity Money market fund | 98.67% | Yes | 7-day 3.48% (Sept. 30) |
| BIL SPDR Bloomberg 1-3 Month T-Bill ETF | State Street ETF | 97.26% | Yes | 30-day SEC 3.61% (Sept. 29) |
| SGOV iShares 0-3 Month Treasury Bond ETF | iShares ETF | 95.14% | Yes | 30-day SEC 3.67% (Sept. 29) |
| SHV iShares 0-1 Year Treasury Bond ETF | iShares ETF | 89.80% | Yes | 30-day SEC 3.74% (Sept. 29) |
| VMFXX Vanguard Federal Money Market Fund | Vanguard Money market fund | 66.61% | Yes | 7-day 3.79% (Sept. 30) |
| FZFXX Fidelity Treasury Money Market Fund | Fidelity Money market fund | 61.52% | No | 7-day 3.52% (Sept. 30) |
| SPAXX Fidelity Government Money Market Fund | Fidelity Money market fund | 50.90% | No | 7-day 3.48% (Sept. 30) |
| SNVXX Schwab Government Money Fund | Schwab Money market fund | 36.20% | No (not marked by Schwab) | 7-day 3.58% (Sept. 30) |
| SWVXX Schwab Prime Advantage Money Fund | Schwab Money market fund | 0.00% | — | 7-day 3.71% (Sept. 30) |
What each keeps after tax in four states
The yield left after federal and state income tax for a single filer aged 35 with $90,000 of wages and $50,000 in the fund for a year, at the yields in the table above, in four states that stand for the four kinds of rule: California and New York (the 50% test), Illinois (exempts the share any fund reports, as 36 states do) and Texas (no income tax, like 8 other states).
| Fund | California | New York | Illinois | Texas |
|---|---|---|---|---|
| VUSXX | 3.02% | 3.02% | 3.02% | 3.02% |
| SNSXX | 2.80% | 2.80% | 2.80% | 2.80% |
| TFLO | 3.01% | 3.01% | 3.01% | 3.01% |
| FDLXX | 2.76% | 2.76% | 2.76% | 2.76% |
| BIL | 2.83% | 2.84% | 2.84% | 2.84% |
| SGOV | 2.88% | 2.88% | 2.88% | 2.89% |
| SHV | 2.91% | 2.92% | 2.93% | 2.95% |
| VMFXX | 2.89% | 2.94% | 2.95% | 3.01% |
| FZFXX | 2.46% | 2.58% | 2.73% | 2.79% |
| SPAXX | 2.43% | 2.55% | 2.68% | 2.76% |
| SNVXX | 2.50% | 2.63% | 2.73% | 2.84% |
| SWVXX | 2.60% | 2.72% | 2.76% | 2.95% |
At these yields VUSXX keeps the most in all four states for this filer: 3.02% in California against 2.43% for SPAXX and 2.60% for SWVXX. Where there is no state income tax, only the yield and how it compounds matter, which is why TFLO and VMFXX come within a few hundredths of VUSXX in Texas. A different income, balance or state changes the gaps; our cash yield after tax calculator runs the same rules for every state, Treasury bills and savings accounts included.
How we built this page
- The shares and test results are the sponsors' own 2025 documents (listed below). Fidelity marks the funds that missed the test with an asterisk; Vanguard, Schwab and iShares mark the funds that met it; State Street lists, for each fund, the states where the test was not met.
- Each state's rule comes from its own instructions, regulations or statutes, listed in our calculator's table of state rules. The after-tax figures come from the reference code that produces the calculator's published test cases.
- The yields are the ones in our monthly cash rate record: 7-day yields from the fund companies for September 30, 2026 and 30-day SEC yields from the ETF sponsors for September 29.
- A sponsor's share can include agency obligations that a state does not exempt, and some states use their own percentage (Pennsylvania, for example); the calculator notes these cases.
Rechecks and changes
We will update the shares when the sponsors publish their 2026 documents, usually in January or February, and the yields every month.
- . First published.
Sources: Vanguard, 2025 U.S. government obligations information (January 2026); Fidelity, 2025 Percentage of Income from U.S. Government Securities; Schwab Asset Management, 2025 Supplementary Tax Information; iShares, 2025 U.S. Government Source Income Information; State Street, SPDR ETF 2025 Tax Summary (spreadsheet). Dollars Ahead is not affiliated with any fund company or state. This page reports what the sponsors and the states publish and what their rules produce for one example. It is not tax or investment advice.