{"id":292,"date":"2017-05-26T17:08:07","date_gmt":"2017-05-26T17:08:07","guid":{"rendered":"http:\/\/belbolcpa.com\/blog\/?p=292"},"modified":"2017-05-26T17:08:07","modified_gmt":"2017-05-26T17:08:07","slug":"municipal-bond-investing-mistakes","status":"publish","type":"post","link":"https:\/\/belbolcpa.com\/blog\/municipal-bond-investing-mistakes\/","title":{"rendered":"Municipal Bond Investing Mistakes"},"content":{"rendered":"<p><a href=\"https:\/\/belbolcpa.com\/blog\/wp-content\/uploads\/2017\/05\/05-26-17-massive-column-1573768-639x958.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-293\" src=\"https:\/\/belbolcpa.com\/blog\/wp-content\/uploads\/2017\/05\/05-26-17-massive-column-1573768-639x958-200x300.jpg\" alt=\"\" width=\"200\" height=\"300\" srcset=\"https:\/\/belbolcpa.com\/blog\/wp-content\/uploads\/2017\/05\/05-26-17-massive-column-1573768-639x958-200x300.jpg 200w, https:\/\/belbolcpa.com\/blog\/wp-content\/uploads\/2017\/05\/05-26-17-massive-column-1573768-639x958.jpg 639w\" sizes=\"auto, (max-width: 200px) 100vw, 200px\" \/><\/a><\/p>\n<p>Investing in municipal bonds can be a benefit due to the fact that the interest income they provide is generally tax-exempt. In order to realize the full tax benefits of municipal bonds, you have to be careful not to make the following mistakes.<\/p>\n<p><em>Low Interest Rates:<\/em> Interest income from municipal bonds is usually much lower than corporate bonds, but since municipal bond interest is generally tax-exempt, your returns may be higher when factoring in taxes. The problem arises when you would have received a greater return by investing in corporate bonds than municipal bonds when factoring in taxes. Generally, if you are in a low tax bracket, then municipal bonds may not make sense.<\/p>\n<p><em>Purchasing Out of State Bonds:<\/em> Municipal bonds are not subject to either Federal or state <a href=\"http:\/\/www.njmedicalcpa.com\/\">taxes<\/a> if you purchase bonds from your home state. If you live in a high income tax state, such as California, New York, or New Jersey, then you should consider purchasing a bond from your state to reduce the overall tax exemption.<\/p>\n<p><em>Alternative Minimum Tax:<\/em> This <a href=\"http:\/\/www.njtaxsolutions.com\/\">dreaded tax<\/a>, also known as the AMT, may make your tax-exempt municipal bonds taxable. If a bond is considered a private activity bond, then you may end up paying taxes on the bond interest.<\/p>\n<p>You must be careful when selecting municipal bonds by doing your research. Otherwise, in your quest for tax-exempt income, you may end up overpaying taxes or unnecessarily receive a low interest rate.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Investing in municipal bonds can be a benefit due to the fact that the interest income they provide is generally tax-exempt. In order to realize the full tax benefits of municipal bonds, you have to be careful not to make the following mistakes. Low Interest Rates: Interest income from municipal bonds is usually much lower [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[2,3,90,6,7,8,10,11,15,16,18],"tags":[64,144,145,55],"class_list":{"0":"post-292","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-budgeting","7":"category-business","8":"category-debt","9":"category-estate-planning","10":"category-expenses","11":"category-financial","12":"category-investments","13":"category-ira","14":"category-new-jersey-tax","15":"category-retirement-2","16":"category-taxes","17":"tag-interest","18":"tag-municipal-bonds","19":"tag-tax-exempt","20":"tag-taxes","21":"entry"},"_links":{"self":[{"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/posts\/292","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/comments?post=292"}],"version-history":[{"count":1,"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/posts\/292\/revisions"}],"predecessor-version":[{"id":294,"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/posts\/292\/revisions\/294"}],"wp:attachment":[{"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/media?parent=292"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/categories?post=292"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/belbolcpa.com\/blog\/wp-json\/wp\/v2\/tags?post=292"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}