Taxation and Fixed Income Investments

In this section

• Tax Treatment of Interest Income
  Review how interest income from fixed income securities is taxed at the federal, state, and local levels.
  • Federal Income Tax on Bond Interest
    Understand the basic federal income tax treatment of bond interest and related taxable income rules.
  • State and Local Tax on Bond Interest
    Review how state and local tax treatment can differ from federal treatment for bond interest income.
• Tax-Exempt Bonds
  Study municipal and other tax-exempt bond structures and the main tax rules that affect them.
  • Municipal Securities and Tax Advantages
    Understand the main tax advantages of municipal securities and how those benefits affect investors.
  • Private Activity Bonds and AMT
    Review how private activity bonds can trigger alternative minimum tax considerations for some investors.
• Original Issue Discount and Market Discount Bonds
  Study how tax rules apply to bonds issued or purchased at discounts to face value.
  • Original Issue Discount Bonds
    Understand how original issue discount accrues and how it is taxed over a bond’s life.
  • Market Discount Rules
    Review how market discount on bonds is recognized and taxed when the bond is sold or redeemed.
• Capital Gains and Tax Efficiency
  Study how capital gains timing and tax-efficient practices affect fixed income investing results.
  • Short-Term vs. Long-Term Capital Gains
    Compare the tax treatment of short-term and long-term capital gains on fixed income investments.
  • Tax Efficiency in Bond Investing
    Review the main ways tax efficiency influences bond selection, holding period, and account choice.
• Taxable Equivalent Yield Calculations
  Study how taxable equivalent yield helps compare taxable and tax-exempt fixed income investments.
  • Comparing Taxable and Tax-Exempt Bonds
    Learn how taxable equivalent yield helps compare after-tax value across different bond types.
  • Taxable Equivalent Yield in Investment Decisions
    Review how taxable equivalent yield influences security selection and portfolio construction choices.