Treasury note

Like US Treasury bills, Treasury notes are debt securities issued by the US government and backed by its full faith and credit.

They are available at issue through Treasury Direct in denominations of $1,000 to $5 million and are traded in the secondary market after issue.

Notes are intermediate-term securities, with a maturity dates of two, three, five or ten years. The interest you earn on Treasury notes is exempt from state and local, but not federal, taxes.

And while the rate at which the interest is paid is generally less than on long-term corporate bonds, the shorter term means less inflation risk.