Muni Bonds: They're Not Just for Rich People Anymore

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While Washington has passed along a nice tax cut on income, capital gains and dividends, states have been busy doing the reverse: hiking taxes.

But if you want an investment that sidesteps federal, state and maybe even some local taxes, think municipal bonds.

Tax-exempt bonds are historically cheap compared with Treasuries right now. Money has been flowing in Treasuries for their safety. And at the same time, the supply of municipal bonds has picked up as state and local governments try to take advantage of the low rates. ...