Earnings on U.S. Treasury securities are exempt from state and local taxes. But they are taxable at the federal level.

At the short end of the yield curve are Treasury bills, with maturities of less than one year. The Treasury offers three-month, six-month and one-year Treasury bills at auction. The yields are followed closely because many indexes - like those for mortgages - are tied to them.

Treasury notes occupy the mid-range of the yield curve. They are called medium-term or intermediate notes, with maturities of one to 10 years.

Treasury bonds are long-term debt instruments with maturities of 10 years or more. One of the benchmark issues are 30-year bonds, although there has been rumors that the government may discontinue any issues that maturate longer than 20 years.