Municipal Stock

Municipal Stock

This type of bond is issued by a local government or their agencies. Municipal stock is commonly used by cities, counties, school districts, and any other governmental entity below the state level. Municipal bonds are exempt from federal taxes and from most state and local taxes.

Also referred to as “muni,” municupal stocks are mostly used to fund costs such as the construction of highways, bridges, or schools. They are purchased for their favorable tax implications.

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