Municipal Bond Interest

Municipal bond interest:

A) Is taxable income both for federal and state tax purposes.
B) Is generally calculated at a higher interest rate than that used for corporate bonds.
C) Is a better source of income for taxpayers in high tax brackets than it is for taxpayers in the lowest tax brackets.
D) Is a better source of income for taxpayers in low tax brackets than it is for taxpayers in the highest tax brackets.
E) Provides an after-tax return calculated by dividing the municipal bond rate by the taxpayer's tax rate.