Use our Tax Equivalent Yield Calculator to quickly determine the equivalent taxable return for a tax-exempt investment. Make informed decisions by comparing municipal bonds with taxable alternatives based on your individual marginal tax rate. Optimize your portfolio effortlessly!
Formula:
Formula:
Tax Equivalent Yield (TEY) = Tax-Exempt Yield / (1 - Marginal Tax Rate)
Where:
- Tax-Exempt Yield: The annual return of the tax-free investment (e.g., municipal bond), typically expressed as a percentage.
- Marginal Tax Rate: Your highest federal income tax bracket, expressed as a percentage (e.g., 24%).