501(c)(3) bond

501(c)(3) bond

A bond issued by a nonprofit college or hospital that pays tax-exempt interest not subject to the alternative minimum tax. Interest from municipal bonds used to finance private activity are either fully taxable or are subject to the alternative minimum tax.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.