Hi, I am new to muncipal bonds. can someone confirm my thinking that the monthly distribution is federal income tax exempted? thanks
yes dividends on municiple bonds are not Federally taxable. But are taxable in IL.
Yes, monthly payments are federal tax exempt. Your state taxes them however for the portion of the payments that arise from bonds not issued by your state. The fund gives you those %'s at tax time.
Thans a lot.