SIE Exam Practice Question 682
Question: 682
Which of the following is/are correct regarding interest paid from municipal bonds?
(1) Interest paid from municipal bonds is not taxed by the federal government.
(2) Interest paid from municipal bonds is never taxable at the state level.
Correct Answer: A
Explanation:
Interest paid from municipal bonds is not taxed by the federal government. The bond interest may also be tax-exempt by various states if certain requirements are met.
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