Municipal bonds are debt obligations issued by states and local governments to raise money for general purposes or to finance a specific project. Bondholders receive a fixed tax-free interest payment semi-annually with the return of their principal on a specific maturity date. Unless otherwise specified, municipal obligations are exempt from all federal income taxes, and most are also exempt from state and local taxes in their state of issuance.

Benefits of Municipal Bonds:

Dependable tax free income

General obligation and essential service revenue municipals are generally considered second in safety only to US Government obligations

Wide and diversified choice of rating, maturity, type of bond and locations.

Excellent liquidity

How Much is Tax-Exempt Income Worth To You?

It is often surprising to see just how much of an advantage you can get with tax-exempt bonds and the chart above does not show the additional benefits of exemption from state and local income tax. In most cases, in-state municipals are exempt from these income taxes too, which can be worth as much as an additional 1.3% to an individual in the 35% Federal bracket.

Corporate bonds are debt obligations, issued by corporations. When you buy a bond, you are actually lending money to the corporation that issued it, which promises to return your principal, on a specified maturity date. Until that time, they pay you a stated rate of interest, monthly, quarterly or semi-annually. Of course, the income interest you receive from corporate bonds is taxable.

Corporate debt is usually traded in the over-the-counter (OTC) market. The OTC market is much larger than the exchange market and most corporate bond transactions, even those involving listed issues, take place in the OTC market.

The corporate bond market is large and liquid, with daily trading volume estimated at $10 billion. The total market value of outstanding corporate bonds in the United States is approximately $2.1 trillion.

Investors in corporate bonds range from large financial institutions, state and local pension funds, to individuals and IRA accounts.

Benefits of Corporate Bonds

High yields: Corporates offer much higher yields than government bonds or CDs of comparable maturities.

Safety:Corporate bonds are evaluated and assigned a rating based on credit history and ability to repay obligations. The higher the rating, the safer the investment. Debt obligations of Blue Chip companies are considered to be the most secure corporate investments.

Diversity: Corporate bonds are available in a variety of sectors, structures and credit-quality characteristics to meet almost any client's investment preferences.

Liquidity: Due to the size and liquidity of the market, investors have little trouble selling their bonds in the open market.

If you are interested in Corporate Offerings please click the Taxable Offerings tab. If you do not see the securities you are interested in, please email us at sales@stoeverglass.com or call us at 1-800-223-3881 and a Stoever Glass representative would be glad to assist you.

U.S. government agencies issue bonds to finance activities supported by public policy. These agencies include the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the Federal Home Loan Bank to name a few. These issuers make credit available to sectors of the economy that may not otherwise be able to afford the costs of financing.

Although these agencies are not backed by the same "full faith and credit guarantee" as Treasuries, their credit quality is generally considered excellent because of their government-sponsored status. However the Government Agencies offer much higher yields than Treasuries. This market functions with an exellent level of efficiency and liquidity due to the high degree of demand. Interest received from these securities is subject to federal income taxes and exemption from state taxes varies from agency to agency.

If you are interested in Corporate Offerings please click the Taxable Offerings tab. If you do not see the securities you are interested in, please email us at sales@stoeverglass.com or call us at 1-800-223-3881 and a Stoever Glass representative would be glad to assist you.

A very tiny portion of municipals are taxable debt obligations which are an outgrowth of the Tax Reform Act of 1986 which put certain restrictions on the issuance of traditional Tax-Exempt Securities. Taxable Municipal Bonds are issued as Private Purpose Bonds to finance Public Purpose projects where the 10% private use limitation has been exceeded