tax-exempt bond

Definition

A bond, issued by a municipal, county or state government, whose interest payments are not subject to federal income tax, and sometimes also state or local income tax.

Use tax-exempt bond in a sentence

You may want to try and get a tax-exempt bond if you are looking for a relatively safe low risk investment.

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We opted for a tax-exempt bond, as it seemed to make the most sense to us at the time given our financial situation.

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The tax-exempt bond was a great way for Jack to expand his business since the Main Street Committee of Sparta was offering such a financial incentive.

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