The interest you earn on a certificate of deposit (CD) is taxable, and understanding CD tax implications is important. Each individual's situation is different, so talk with a tax professional about taxable interest and how you can optimize your plans with CDs or other financial products. For example, ask your tax consultant if you should consider CDs in a Traditional IRA or Roth IRA.
Another way CDs could potentially make sense for your situation is with college savings, but always get help from your tax professional before you take unnecessary risks. In the meantime, take a look at Ally's CD options to learn the range of benefits each one offers.
Please consult with your tax professional to understand all of the details of your particular situation.