Treasury notes, like other marketable Treasury securities, are debt obligations of the U.S. Government and are backed by the government's full faith and credit. Offered in multiples of $100, notes pay interest every six months at a rate determined when they are auctioned. Notes can be held to maturity or sold prior to maturity. At maturity, the principal is paid to the owner.
Treasury currently issues notes as follows:
|TYPE OF NOTE||FREQUENCY OF AUCTION|
|10-year||Original Issues: February, May, August, November
*Reopenings: January, March, April, June, July, September, October, December
Notes can be purchased either directly from Treasury or through an intermediary such as a bank or broker. Interest from notes is exempt from state and local income taxes, but subject to federal tax.
* In a reopening, we sell an additional amount of a previously issued security. The reopened security has the same maturity date and interest rate as the original security. However, as compared to the original security, the reopened security has a different issue date and usually a different purchase price.