____ bonds exist because the principle of federalism states that the federal government should not tax states and municipalities and income from their bonds.

Question

Quizplus · Accepted Answer

Tax-exempt bonds, also known as municipal bonds, are issued by states, cities, and other local governments to fund public projects such as schools, roads, and utilities. The interest earned on these bonds is exempt from federal income tax, as well as state and local taxes in most cases. This exemption exists because the principle of federalism dictates that the federal government should not tax the income of states and municipalities.

____ Bonds Exist Because the Principle of Federalism States That