Muni Bonds

Submitted by mhanrahan on Thu, 05/21/2015 - 18:06

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Hi,

I'm wondering what the correct way to enter muni bonds. I have them as a bond and cd under regular assets and have also indicated the percent of regular assets in municipal bonds. Is the interest I receive based on the rate and inflation percents i enter in regular assets?

Thanks

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dan royer's picture

dan royer

Thu, 05/21/2015 - 21:46

As I think about this, I

As I think about this, I wonder if the tax-exempt nature of these bonds is not modeled well or not modeled at all in the MC portfolios since even if you put those in regular assets, the tax consequences may be applied to the entire set of regular assets per the tax consequences that you indicate in the Taxes tab in Assumptions.

I'd have to get help to think that through.

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Mike OConnor

Fri, 05/22/2015 - 11:12

Yes, the interest on all

Yes, the interest on all regular assets, regardless of which subcategory, is based on the Nominal rate of return that you set.
The share of regular assets invested in tax-free municipal bonds is exempt from federal income tax.

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mhanrahan

Fri, 05/22/2015 - 23:30

Perfect! Thanks!

Perfect!

Thanks!

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