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Bond means:
an obligation to pay. Most federal, municipal, and corporate bonds pay interest twice a year (semiannually). Interest on municipal bonds is generally nontaxable for federal income tax purposes and in the municipality of issue. Interest on federal government bonds is taxable for federal purposes but tax-free for state income tax purposes. Corporate bond interest is generally fully taxable. Former IRC (check if this IRC provision is current here) §§150(a)(l) and 171(d).

U.S. and other Developed Countries International Tax Meaning

Interest-bearing debt obligation to a government or entrepreneur. The rate of interest is usually fixed.

See the entries Income Tax and State Income Tax in the American Encyclopedia of Law.

Description and Definition of Bond

A written promise to repay a loan plus interest. Bonds usually have a maturity of more than one year. If you invest in bonds you will usually receive interest twice a year. Investors can buy bonds from a company or government entity, essentially loaning the company or government money. Municipal bonds are federal income tax free.


See Also

Further Reading

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