Tax-exempt Bond
Bond whose interest is free of federal, state, or local tax in the state of the issuer. It is typically a municipal bond of estate or county agency. For example, a New York City resident does not pay federal, state, or city tax on the interest received from a New York City obligation. It is triple tax-free though this is not necessarily the case with other states. The return on a tax-exempt bond is equivalent to a higher return on a taxable corporate bond because of the tax savings. The dollar advantage of a tax-exempt security increases as the tax rate rises. Assume a taxpayer in the 31% tax bracket receives 5% on a tax-exempt bond. The equivalent taxable yield on a corporate bond is 7.2%(5%/.69).
Popular Real Estate Terms
Urbanized area in and around a major city. The metropolitan area may overlap county and state boundaries and may encompass a city, its suburbs, and the orbit of its social and economic ...
Same as term resale proceeds: Net amount received when property is sold. It equals the selling price less outstanding mortgage balance less all costs incurred in connection with the sale. ...
An individual's option to fairly utilize another's property. An example is privileges under an easement. For example, a person receives permission to use a lake on the private property of ...
The term “de jure” comes from the Latin “by law” or “by right” and is commonly used to describe something that exists according to the law or by right. ...
To define active participation, we have to look at owning residential rental real estate. Activities that handle rental real estate are considered passive activities and are affected by the ...
A lien on property such as for the nonpayment of real estate taxes or mechanic's lien for repairs to the home without the consent of the owner, created by operation of law. ...
One who has committed a tort. A tort is a civil wrong that occurs as a result of a breach of legal duty owed to someone, e.g., negligence. A tort does not arise from a breach of contract. ...
Designing a home with a Spanish cultural flavor. ...
Legal obligation to pay for a benefit received as if a contract has actually occurred. This may arise in a few cases so that an equitable situation occurs. An example is when a homeowner ...
Have a question or comment?
We're here to help.