Taxable municipal bonds are bonds issued by a municipality that do not carry the traditional tax benefits of regular municipal bonds. They are taxable because they are seen as not meeting the requirement of serving a public good that is required for a bond to be tax free.
Taxable municipal bonds fall into two categories:
Taxable municipal bonds share the very high quality credit characteristics of the municipal market in general, with the majority rated Aaa and only 1% being rated below investment grade.
For the definition and explanation of more bond related words visit the Learn Bonds glossary where we give the meaning of many additional terms.