Municipal Bond Forum
Munis for tax-free income, not capital gains
Q
I have more than $200,000 in muni bonds with fairly long maturities. None are subject to the AMT and almost all are insured, though I understand a number of insurers have defaulted as well. I’m somewhat worried and would appreciate interest continuing to be paid despite a decrease in bond values. I have taken past gains — but not in munis — for the gain or loss. Your thoughts?
A
James A. Klotz responds:
If you review our Web site, you will see that we believe bond investors should purchase munis for the tax-free income, not capital gains.
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