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Triple Tax-Exempt
(redirected from Tax-Exempt Securities)

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Triple tax-exempt
Municipal bonds featuring federal, state, and local tax-free interest payments.

Triple Tax-Exempt
Describing a municipal bond that is exempt from federal, state, and local taxes. The United States Constitution forbids the federal government from taxing any state and local bonds. Most states and municipalities offer tax exemptions for residents who invest in their bonds; thus, to be eligible for triple-tax-free status, a bondholder must be resident in the municipality and/or state issuing the bond. Triple-tax exempt bonds almost always offer low returns, exposing bondholders to inflation risk. See also: After-Tax Basis.


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After all, property taxes are based on appraisals, not on estimated market values, and tax-exempt securities are typically guaranteed against default.
The popularity with state and local governments of Build America Bonds--taxable securities with interest payments subsidized by the federal government--is slashing issuance of long-term tax-exempt securities.
Federal income tax expense increased by $415,000 due to increased pre-tax income and an increasing proportion of taxable income due to the maturity of tax-exempt securities in the investment portfolio and the reduction of BOLI income due to death benefits received in the 2006 period.
 
 
 
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