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Tax-Free Interest: Most municipal bonds are exempt from federal income tax and some may also be state- and local-tax-free. Low Risk: Because they are backed by government entities, muni bonds have ...
Interest income from most municipal bonds is excludable from gross income for federal income tax purposes, and may be exempt from state income tax as well, depending on the applicable state laws. [14] Internal Revenue Code section 103(a) is the statutory provision that excludes interest on municipal bonds from federal income tax. [15]
Composition of state and local tax revenues by sales taxes (brown), property taxes (white), licenses and other fees (grey), individual and corporate income taxes (green) in 2007. Determining the value of property is a critical aspect of property taxation, as such value determines the amount of tax due.
An unlimited-tax pledge must often follow a voter authorization in which local residents agree to raise property taxes by an amount equal to debt service requirements over the life of the bonds. That feature provides the political advantage of voter affirmation of the use of the bonds and allows the local government to avoid raising its ...
The Delaware National High-Yield Municipal Bond Fund invests in medium and lower-grade municipal bonds to generate a high level of current income that is exempt from federal income tax.
For example, imagine you pay federal tax at a 24 percent rate and state tax at a rate of 6 percent, and the municipal bond offers a yield of 3 percent.
The financings are repaid over the selected term (over the course of somewhere between 5 and 35 years) via an annual assessment on their property tax bill. PACE bonds can be issued by municipal financing districts, state agencies or finance companies and the proceeds can be used to retrofit both commercial and residential properties. One of the ...
Municipal bonds can be an attractive investment if you’re looking for bonds that generate consistent income with low credit risk. Tax-free municipal bonds may be even better since they’re tax ...