NEW YORK ( TheStreet) -- In order to do an apples-to-apples comparison between the yield on a municipal bond and a taxable bond, you have to calculate either the taxable-equivalent yield of the muni bond or the after-tax yield of the taxable bond.Unfortunately, the instructions can't be boiled down to two simple equations because not all munis are totally tax-free (some are subject to state income taxes) and not all taxable bonds are totally taxable (Treasury bond, note and bill interest are exempt from state income taxes).
How Municipal Bonds Work
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