FINRA’s BrokerCheck Obtain more information about our firm and its financial professionals MENU skip navigation Taxable Equivalent Yield Taxable vs. Tax-Exempt Yields Municipal bonds are sold by cities, counties, states and other political bodies (public hospital, school district). The federal government and its agencies do not sell municipal bonds. However, most municipal bonds are free of federal income taxes, although they may be subject to the alternative minimum tax. Because of this, the stated interest rate on municipal bonds is typically lower than comparable non tax-exempt bonds. How much would you have to receive from a taxable bond to realize an equivalent yield? You can find the answer by entering the following information: Your federal income tax bracket: 0 10 12 22 24 32 35 37 The yield (in percentage points, 0% to 10%) on the municipal bond you are considering: 0 2 4 6 8 10 Previous Next Calculate This hypothetical example is used for illustrative purposes only. Actual results will vary. The information in this calculator is not intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald Connect, LLC. © 2021 Emerald Connect, LLC. All Rights Reserved. This information is intended for use only by residents of (AR, AZ, CA, CO, DC, DE, FL, GA, IA, ID, IL, IN, KY, LA, MA, MD, MI, MO, MS, NC, NJ, NV, NY, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, VT, WA). Please consult with each individual Financial Advisor listed on this site to understand what states they are licensed to transact business. For parties residing outside of the U.S., this information is: (i) provided for informational purposes only, (ii) not and should not be construed in any manner as an offer to participate in any investment or to buy or sell any securities or related financial instruments, and (iii) not and should not be construed in any manner as a public offering of any financial services, securities or related financial instruments. Products and services listed may not be available, or may have restrictions, depending on client country of residence. Investment and Insurance Products Are: Not Insured by the FDIC or any Federal Government Agency Not a Deposit or Other Obligation of, or Guaranteed by, the Bank or Any Bank Affiliate Subject to Investment Risks, Including Possible Loss of the Principal Amount Invested Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN). Wells Fargo Advisors is the trade name used by Wells Fargo Clearing Services, LLC and WFAFN, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company. Any other referenced entity is a separate entity from WFAFN. A note about Social Media: Opinions, comments and actions taken on Social Media are those of the third party and do not necessarily reflect the views of the creator of this profile or of the firm. Social Media is intended for U.S. residents only and subject to the following terms: wellsfargoadvisors.com/social. Links to third-party websites are provided for your convenience and information purposes only. Wells Fargo Advisors is not responsible for the information contained on third party websites. ©2019 Wells Fargo Advisors Financial Network, LLC. All rights reserved. Site Map Privacy Policy Legal Security FINRA’s BrokerCheck Obtain more information about our firm and its financial professionals