Tax
Compulsory charges levied by a governmental unit for the purpose of raising revenue.
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Taxable Bond
A Bond, the Interest on which is not excludable from gross income for federal income tax purposes.
See Also
Tax Credit Bond
A taxable bond that provides a tax credit to the holder in lieu of tax-exempt interest.
Direct Pay Bond
A taxable bond that offers a federal Interest subsidy to the Issuer in lieu of the interest being excludable from federal income tax.
In Contrast To
Tax-Exempt Bonds
A bond, the interest on which is excludable from gross income for federal income tax purposes.
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Escrow Fund
Trust account established in the escrow deposit agreement that holds cash, investments, usually obligations of the federal government or, sometimes, federal agencies, or both, all of which are pledged to the payment of the debt service of the refunded bonds.