Long-Term Tax-Advantaged Investment Vehicles
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Tax-Advantaged Income from Your Idle Cash

Long-term tax-advantaged investments may help you save on taxes and increase the effective yield of your portfolio. These include options such as municipal bonds, municipal investment funds, preferred stock and other long-term notes and funds.

  • Generate tax-advantaged income on your idle cash
  • Increase your portfolio’s effective yield
  • Make a difference in your bottom line by considering after-tax returns on invested funds
  • Balance your portfolio with the option of investing in both taxable and tax-advantaged securities.

Compare Long-Term Tax-Advantaged Investment Vehicles

Investment Vehicle Income/ Tax Status Credit Quality Maturities/ Liquidity Denominations
Municipal Notes Higher after-tax returns than comparable taxable instruments. Available from major rating agencies. Maturities less than 1 year. Highly liquid. Generally $5,000 or $25,000.
Municipal Bonds Regular, fixed interest payments are exempt from federal taxes and in some cases, state and local taxes. Most rated by major rating agencies. Maturities from 10 to 30 years. Highly liquid. Generally $5,000 or $25,000.
Municipal Bond Funds Attractive current income. Returns may fluctuate. Depends on investment objective stated in prospectus. No maturity. Highly liquid. Generally $1,000.
Municipal Investment Trusts Monthly tax-exempt income. Generally rated investment-grade. Specific maturity range with a variety of maturity options. Highly liquid. Not applicable.
Common Stock 70% of dividends may be deducted from taxable income. Not applicable. No maturity. Liquid based on trading activity. Various.
Preferred Stock 70% of dividends may be deducted from taxable income. Rated. No maturity. Liquid based on trading activity. Various.

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Neither Merrill Lynch nor its Financial Advisors offers tax advice. Please consult a tax professional to determine the impact of your choices on your tax obligations.