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 marginal tax bracket?

What is the yield (in percentage points) on the municipal bond you are considering?

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Wornel Simpson
821-Hawkcrest Circle Sacramento, CA 95835
Phone: (916) 446-7099 Fax: (916) 446-0725
www.wornelsimpson.com wornel@wornelsimpson.com

Securities and investment advisory services offered through FSC SECURITIES CORPORATION, member FINRA/SIPC and a registered investment advisor.  Wornel Simpson is not affiliated with FSC Securities Corporation or registered as a broker-dealer or investment advisor.