Treasury bonds pay a fixed interest rate on a semi-annual basis. This interest is exempt from state and local taxes. Treasury bonds are government securities that have a year term. They earn interest until maturity and the owner is also paid a par amount, or the principal, when the Treasury bond matures. They are marketable securities, so they can be sold before maturity — unlike U. You koney buy Treasury bonds directly and electronically from TreasuryDirect through non-competitive bidding. T-bonds are also bought through banks, brokers or dealers by either a competitive or non-competitive doo. If you do receive the Treasury bond, it may be less than the amount you requested. Treasury bond auctions happen four times a year: mame February, May, August and November. A year U. Treasury Bond was paying around a 3. If you have a TreasuryDirect.