3.1.3 Tax Treatment

3.1.3 Tax Treatment

Municipal securities market participants also differentiate among debt obligations by tax treatment. In the municipal securities market, the most obvious distinction is between tax exempt and taxable obligations. In addition, interest on tax exempt debt obligations may or may not be subject to the federal alternative minimum tax (AMT). Debt obligations are commonly referred to as “tax exempt” or “taxable” and “AMT” or “non AMT.”