Taxable Equivalent Yield  

Municipal bonds are sold by cities, counties, states and other political bodies (public hospital, school district).

The federal government and its agencies do not sell municipal bonds. However, most municipals are free of federal taxes. Because of this, the stated interest rate on municipals is typically lower than comparable non tax-exempt bonds.

How much would you have to receive from a taxable bond to realize an equivalent yield? You can find the answer by entering the following information:

     


What is your federal income tax bracket?

What is the yield (in percentage points, 0 to 10 percent) on the municipal bond you are considering?

%
 
   
   
Roger Butler, www.butlerinvestment.com
165 S. Union Blvd., Suite 622 Lakewood, CO 80228
(Union Tower - near West 6th Avenue & Union Blvd.)
Phone: (303)753-9223 or 1-888-670-1737 Fax: (303)753-9164
mail@butlerinvestment.com