Municipal Bonds Interest Calculator

Added Costs if Municipal Bonds Are Taxed

There is support in Congress and the White House for proposals that would limit the exemption for interest earned on municipal bonds. If adopted, these would significantly increase the infrastructure financing costs for local governments, and thereby local residents. Use this calculator to see the increase in interest costs to finance investments in schools, roads, water and sewer systems, airports, bridges and other vital infrastructure in your community, if the federal government decides to tax any portion of interest earned on municipal bonds.

How To Use the Calculator

By entering the dollar amount of the project cost to be financed, the interest rate and length of its bonds into the calculator below, you will see three calculation.

1.  The interest costs for the project under current law with the interest earned being fully tax-exempt.

2.  The interest costs for the project if there is a 28 percent cap on the interest earned.

3.  The interest costs for the project if the exemption is fully repealed.

The bottom line is that, if the federal income tax exemption is eliminated or limited, cities and their tax payers will pay more to finance infrastructure projects or there will be less infrastructure investment and fewer jobs created.

Annual Interest Rate:

Enter the annual interest rate for your municipal bond

Loan Terms:

Enter the number of years (loan term) for your bond

Principal Amount:

Help - Principal Amount