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Bonds Make for Strange Political Bedfellows

Klotz on Bonds

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<h3>James A. Klotz</h3>

James A. Klotz

They may not agree on much, but the Bush and Kerry camps have at least one thing in common: a strong affinity for tax-free bonds.

According to the recently released 2003 tax return of Teresa Heinz Kerry, the wife of the presidential candidate earned $2.78 million in tax-free income from “state, municipal and public entity bonds.”

But she’s not the only prominent political figure who’s fond of bonds.

As we previously noted, Vice President Dick Cheney and Defense Secretary Donald Rumsfeld also have significant holdings in tax-free bonds.

Municipal bonds, it seems, are one of the few things that enjoy strong bipartisan support.

James A. Klotz is the President of FMSbonds, Inc.
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Oct 22, 2004

Please note that all investing entails risk. Fixed income securities are subject to risks that will affect their value prior to maturity. Some of these risks can be related to changes in market conditions, issuer creditworthiness, and interest rates. This commentary is not a recommendation to buy or sell a specific security. All references to tax-free income refer to U.S. federal income tax. Income earned by certain investors may be subject to the Alternative Minimum Tax (AMT), and or taxation by state and local authorities. Please consult with your tax professional prior to investing. For more information on these topics please click on the “Bond Basics” link below or search by keyword at the top of this page.