Romney has little municipal bond interest income, which means he paid more Massachusetts state taxes than others customarily do.
FORBES: Mitt Romney Is Hardly A Pig When It Comes To Tax Deductions
Current yield can be used to compare the interest income provided by a bond to the dividend income provided by a stock.
This tax is assessed to filers who have large amounts of certain types of income, such as ISO bargain elements or municipal bond interest, and is designed to ensure that the taxpayer pays at least a minimal amount of tax on income that would otherwise be tax-free.
Bear in mind that in calculating this income you dont count municipal bond interest or unrealized capital gains.
The "base" calculation includes one-half your Social Security, plus almost all your other income, including tax-exempt bond interest but not Roth withdrawals.
Thanks to the magic of bond-premium amortization, that maneuver reduces your taxable interest income over the life of the bonds.
Unlike corporate bonds or U.S. Treasuries, muni bond interest is often federal tax-free and exempt from state income tax of the state they are issued.
While the 15% rate applies to most corporate payouts, that's not the case for most real estate investment trust dividends or for bond fund dividends, which are really interest and are taxed at ordinary income rates of up to 35%.
Over the years, even as North Korea has again distanced itself from the international community and toyed with nuclear ambitions, interest in the zero-coupon, no-income bond has waxed and waned among a select few buyers interested in frontier markets or risky bets.
The reason is that someone buying a high-coupon bond at a premium is entitled to write off the premium over time as a deduction against the interest income.
Still, floating-rate bond funds may be the best fixed-income deal available in an environment of rising short-term interest rates.
But for your Uncle Al living in Boca, if he is paying 20% over the value of Treasury bonds at par today to get interest payments of just 1.6%, he is going to get next to nothing in real income after inflation, and he is going to watch the value of his bond plummet once interest rates start rising again, forecast to occur by 2014.
Imagine, in JPMorgan Chase's case, the frustration at being the leading credit derivatives house, high-yield-bond underwriter and fixed-income research firm (among other things) and then losing on some bets on interest rates.
But the case commands a great deal of attention because it would transform the country's fixed income markets if the Court determines out-of-state bond holders should get refunds for the interest they've paid on these investments.
应用推荐