Do you think only the wealthy benefit from tax-free municipal bond interest?

This comes under the unintended consequences category of attacking the wealthy.

I remember reading an article during a past presidential campaign about the tremendous amount of tax-free income earned by Sen John Kerry’s wife. It was a great deal of money to be sure and it escaped all federal taxes and even resident state taxes. Is that fair?

You bet it is. If these bonds issued by state and local governments paid taxable interest, the interest rate would be considerably higher. Municipal bonds pay a lower interest rate and are not taxed to provide government with a less expensive source of financing.

Who pays the interest on these bonds and who benefits from the programs and projects they pay for? You do! The average citizen is the real beneficiary of these tax-free low interest payments.

The lesson here is that paying ones fair share is not necessarily what it may appear to be.