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Bonds can provide passive income, some of which may be tax-free if you're investing in municipal bonds. The tax-equivalent yield formula can be a useful tool for comparing taxable and tax-free ...
3. Series I bonds and EE bonds. While not as tax-friendly as municipal bonds, Series I bonds and EE bonds offer some attractive tax advantages. The interest earned is typically free from state and ...
Generally speaking, income you earn from your job or business is fully taxable at the federal level and, where applicable, at the state level. Capital Gains Tax on Stocks: What It Is and How To...
For tax purposes Reverse convertible notes are considered to have two components: a debt portion and a put option. At maturity, the option component is taxed as a short-term capital gain if the investor receives the cash settlement. In the case of physical delivery, the option component will reduce the tax basis of the Reference Shares ...
In many cases, it could make sense to go with a lower-yielding tax-free bond than a high-yielding traditional bond, because the after-tax yield on the muni bond is ultimately higher.
Positive, tax-free carry can reach into the double digits. The bet in municipal bond arbitrage is that, over a longer period of time, two similar instruments--municipal bonds and interest rate swaps--will correlate with each other; they are both very high quality credits, have the same maturity and are denominated in U.S. dollars.
A municipal bond, commonly known as a muni, is a bond issued by state or local governments, or entities they create such as authorities and special districts. In the United States, interest income received by holders of municipal bonds is often, but not always, exempt from federal and state income taxation.
Bond ETFs can come in a variety of forms, including funds that aim to represent the total market as well as funds that slice and dice the bond market into specific parts – investment-grade or ...