Submitted By: someone
Answered: May 5, 2017 8:56 am

I received tax-free interest on municipal bonds. Do I have to report the interest?

While the interest is not subject to income tax, it must be reported on your federal income tax return. If you collect Social Security benefits, the interest is taken into account in determining whether and to what extent the benefits are includible in gross income. And if any of the interest is on private activity bonds, the interest likely is taxable for alternative minimum tax purposes.

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Tax Glossary

Section 179 deduction (or First-year expensing)

A deduction allowed for investments in depreciable business equipment in the year the property is placed in service.

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