Municipal Securities
Chapters in this video
- 0:00 Par value vs minimum denomination trap
- 1:14 Tax exemption on interest, not capital gains
- 3:15 General obligation bonds: taxing power and voters
- 3:53 Revenue bonds: project income, no voter approval
- 5:03 IDRBs and short-term municipal notes
- 6:14 Official statement delivery to settlement date
- 6:44 MSRB writes rules, FINRA enforces, SEC oversees anti-fraud
- 8:04 Rapid-fire exam recap
What this video covers
- Why municipal bond interest is generally exempt from federal income tax, and how double-exempt and triple-exempt status works for in-state investors
- The exact difference between par value ($1,000) and minimum denomination ($5,000), and why the test writers bait you into confusing them
- Why capital gains on municipal bonds are fully taxable even though interest income is tax-exempt
- How general obligation (GO) bonds use taxing power and voter approval, while revenue bonds rely on project income with no tax backup and no voter approval
- What industrial development revenue bonds (IDRBs) really are: municipality in name only, with private corporation credit risk
- How Tax Anticipation Notes (TANs), Revenue Anticipation Notes (RANs), and Bond Anticipation Notes (BANs) differ by the funding source each anticipates
- Why the Municipal Securities Rulemaking Board (MSRB) writes rules for dealers but has zero authority over issuers, and where FINRA and the SEC fit in the enforcement chain
Read the full lesson, free
This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete SIE course in the app is free too, including adaptive practice questions and spaced-repetition flashcards.