tax free municipal bondsTax free municipal bonds may be issued by towns, cities, and regional and local agencies. Because of the financial difficulties of some local governments, the risk inherent in some of these bonds is reduced by the tax-free status. There are three primary types of municipal bonds:
Of these, the general obligation bonds get their creditworthiness from the fact that the bonds are backed by the taxing power and assets of the municipality in question. Meanwhile, revenue bonds are backed by revenues from specific sources, including projects, authorities, and agencies, but not the full assets and taxing power of the issuer. Finally, industrial development bonds are used to finance projects of industrial development. Many of these bonds are used to finance developments to lure firms to locate or to relocate to the area of the municipality. Resources for Tax Free Municipal BondsTo learn more about the market for these bonds, you can read information from online sources as well as invest some time in reading books on the subject. One good online source is available as a PDF document, located at
Other sources for municipal bond information include:
According to the SEC, most municipal securities offerings are exempt from the registration provisions of the federal securities laws. That means municipal issuers do NOT have to file a registration statement with the SEC. But you can still obtain information about municipal securities from the Municipal Securities Rulemaking Board (MSRB) and Nationally Recognized Municipal Securities Information Repositories (NRMSIRs). Since 1990, underwriters of municipal securities have filed an offering document for most municipal securities offerings with the MSRB’s Municipal Securities Information Library. In addition, according to the SEC, for most municipal securities issued after July 3, 1995, NRMSIRs have collected on an annual basis financial information and operating data, as well as notice of certain important events, such as default of a bond. |