jdbst56@[EMAIL PROTECTED]
writes:
>> I suggest the OP look at muni bond funds, which are an exceptionally
good
>> deal right now.
>
> Thanks for the insight. Since I live in PA, I suppose I should look
> at something that would avoid state income tax. What's your thoughts
> on VPAIX? Also, these funds that we are discussing right now are not
> subject to AMT, correct?
Well, if I lived in PA, I'd have my bond allocation in VPAIX instead
of VMATX. :-)
Re AMT, see Vanguard's web site:
https://personal.vanguard.com/us/planningeducation/taxcenter/PEdTaxAMTInfoContent.jsp
"Most Vanguard municipal bond fund managers sought to limit their
funds' investment in private-activity bonds in 2006 and 2007. However,
the funds are not, and likely will not, be completely AMT-free. By
prospectus, Vanguard municipal funds may invest up to 20% of assets in
private-activity bonds."
I know there are national muni bond funds that are AMT-free by prospectus
but it may be harder to find one specific to a given state. The Vanguard
funds have the advantage of very low fees, at least.
-Sandra the cynic
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