Taxation of Municipal Bonds

This section of Investing Tax Free - Municipal bonds investing website will discuss the federal and state tax consequences of owning " municipal bonds." At the outset, it should be understood that the term " municipal bonds " is typically used to describe all tax exempt bonds, whether or not they are actually issued by a municipality (as opposed to a state, county or other political subdivision).

Although such municipal bonds or tax exempt bonds are commonly referred to as "tax exempt," there are numerous federal and state tax consequences associated with the acquisition, ownership, and disposition of such municipal tax exempt bonds. This section will provide an overview of such consequences.

The information on this section of Municipal Bonds investing is based upon the United States federal income tax laws as currently in effect and as currently interpreted and does not include any description of the tax laws of any foreign government that might apply to a beneficial owner. Prospective purchasers of tax exempt bonds should consult their own tax advisors concerning the application of federal and state tax laws to their particular situation.

Click on the links below to browse this section of Municipal Bonds and Tax Exempt bonds taxation:

• Municipal Bond Funds - Mutual Funds that invest primarily or solely in municipal bonds

   

• Capital Gains Tax - the tax consequences of selling municipal bonds at a loss or at a premium

   

• Original Issue Discount (OID)

   

• Bond Premium for Tax exempt bonds

   

• Market discount for municipal bonds

   

• Tax exempt bonds