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Thursday, July 30, 2020 | History

4 edition of Taxable bond alternative for State and local governments found in the catalog.

Taxable bond alternative for State and local governments

by United States. Congress. Joint Committee on Internal Revenue Taxation.

  • 224 Want to read
  • 20 Currently reading

Published by U.S. Govt. Print. Off. in Washington .
Written in English

    Places:
  • United States.
    • Subjects:
    • Municipal bonds -- Taxation -- Law and legislation -- United States,
    • State bonds -- Taxation -- Law and legislation -- United States

    • Edition Notes

      At head of title: Committee print.

      Statementprepared for the use of the Committee on Ways and Means by the staff of the Joint Committee on Internal Revenue Taxation.
      ContributionsUnited States. Congress. House. Committee on Ways and Means.
      Classifications
      LC ClassificationsKF6415 .A25 1976
      The Physical Object
      Paginationiii, 18 p. :
      Number of Pages18
      ID Numbers
      Open LibraryOL5013847M
      LC Control Number76601358

        It’s impossible to see how this deterrent to ownership can benefit state and local governments as issuers of wealth-taxable bonds. Granted, such a Author: Girard Miller. Tax-Exempt Bonds: Their Importance to the National Economy and to State and Local Governments The tax exemption of the interest on State and local government bonds is a proven, effective way to provide needed funding for public infrastructure and the related benefits to the economy from job creation and business development.

      Debt Burdens of California’s State and Local Governments 71 shape. ¹² This was not included earlier because a consistent assessment of it was not available for all the years examined in the. Start studying American Government Unit 3 Taxes All. Learn vocabulary, terms, and more with flashcards, games, and other study tools. are the most volatile political issue facing state and local governments today. property tax. an amount that reduces taxable income based on the number of PEOPLE DEPENDENT on the wage owner.

      Federal Tax Policy. The Government Finance Officers Association has reviewed the various proposals to reform the existing federal tax system and has concerns about the impact these proposals may have on the ability of states and local governments to continue to finance their projects with general obligation and revenue bonds for essential government services and to raise revenues. alternative minimum tax imposed for taxable years beginning prior to January 1, In addition, in the opinion of Co-Bond Counsel, under existing statutes, interest on the Series A Senior Bonds is exempt from personal income taxes imposed by the State of New York or any political subdivisionFile Size: 2MB.


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Taxable bond alternative for State and local governments by United States. Congress. Joint Committee on Internal Revenue Taxation. Download PDF EPUB FB2

Get this from a library. Taxable bond alternative for State and local governments. [United States. Congress. Joint Committee on Internal Revenue Taxation.; United States. Congress. House. Committee on Ways and Means.]. Taxable bond alternative for State and local governments Item Preview remove-circle Taxable bond alternative for State and local governments by United States.

Congress. Text is printed faintly throughout book. Addeddate Call number JCS CameraPages: Bond refinancings or “refundings” are used by state and local governments most frequently to achieve debt service savings on outstanding bonds.

Though less frequent, refunding bonds can also be issued to remove or revise burdensome bond covenants or to restructure debt service payments. Refunding bonds are characterized as either current. In general, the interest on municipal bonds sold by state and local governments to finance very specific projects, as well as bonds issued by not-for-profit organizations and other “private activity” issuers such as airports and universities, is going to be included in the AMT.

Because of the federal tax exemption, state and local governments can borrow more cheaply than other debt issuers, such as corporations, for a given level of risk and length of maturity. The federal tax exemption therefore functions as a federal subsidy to state and local public infrastructure investment.

The interest from Treasury bills, notes and bonds is taxable at the federal level, but not the state and local level. Certain ment agency securities are also taxable at the federal level Author: Andrew Bloomenthal.

Tax-Exempt Bonds: A Description of State and Local Government Debt Congressional Research Service Summary This report provides information about state and local government debt. State and local governments often issue debt instruments in exchange for the.

On the contrary, municipal bond issuers have more latitude. State and local governments can raise taxes, if necessary, to support the general obligation bonds, which are backed by the issuer's. Income from bonds issued by state, city, and local governments (municipal bonds, or munis) is generally free from federal taxes.*You will, however, have to report this income when filing your taxes.

Municipal bond income is also usually free from state tax in the state where the. The state recently sold a $ million taxable general obligation refunding — its first taxable since tapping the federal government’s Build America Bond program — achieving 11% of net Author: Yvette Shields.

taxable bond of like term and risk) adjusts the spread for the level of interest rates. A lower ratio implies a greater savings to state and local governments relative to taxable debt.

As the ratio approaches one, however, tax-exempt borrowing approaches that of taxable by: 2. State and Local Government Series Securities Overview. The State and Local Government Series (SLGS) securities program was established in as the result of federal legislation enacted in which restricted state and local governments from earning arbitrage profits by investing bond proceeds in higher yielding investments.

State and local governments could suffer hits to revenue collections under the tax reform bills being considered in the U.S. Senate and House because of the potential loss of a federal subsidy Author: Karen Pierog. Generally, taxable munis are still exempt from state and local taxes, so investors in states with high-income taxes may find that they get a better after-tax return than with other fixed-income.

State and local governments do not pay federal income tax, and absent federal constraint, have unlimited capacity to issue debt at low interest rates and reinvest the bond proceeds in higher-yielding taxable debt instruments, thereby earning arbitrage profits.

Although state and local governments may still advance refund their bonds, the new refunding bonds must now be taxable. As a result, the refunding bonds will likely offer higher interest rates, thereby reducing the money saved on interest payments.

Even so, taxable advance refundings may still offer worthwhile savings in some cases. See also:File Size: 1MB. The term “governmental bond” means a bond issued as part of an issue, no portion of which consists of private activity bonds.

Section of the Code sets forth private activity bond tests for the purpose of limiting the volume of tax-exempt bonds that finance activities of persons other than state and local governmental entities. These. The Taxable Fringe Benefits Guide was created by the Internal Revenue Service office of Federal, State and Local Governments (FSLG) to provide governmental entities with a basic understanding of the Federal tax rules relating to employee fringe benefits and reporting.

Interest on a bond used to finance government operations generally Publication 17 - Your Federal Income Tax (For Individuals) - Capital Gains and Losses Tax-exempt state and local government bonds. Stated another way, if you can get % return on a muni bond, it is the equivalent to a return on a taxable investment of 6%.

State tax considerations. The above computation doesn’t take into account state or local income taxes. They also have a considerable impact on your investment returns. Municipal bonds are issued by state and local governments in many nations. In the United States the interest on these bonds is usually exempt from federal income tax, which provides an incentive Author: James M.

Poterba.State-local governments employed about million individuals incompared with Federal employment (excluding the armed forces) of million. State-local purchases of goods and services now exceed those of the Federal government for non-defense purposes.Now assume that investor has $30, to invest and they are considering two alternative investments: a tax-exempt municipal bond yielding 3% versus a taxable corporate bond yielding 4%.

If that investor buys the municipal bond, they would earn $ per year in interest (a 3% yield) and pay no federal income tax on the interest income.