§ 6575 Bond Taxation Exemption

• •Money from bonds (like special loans to the government) is usually not taxed in this state.
• •You don’t pay regular taxes on the money you make from these bonds.
• •But if someone gives you bonds as a gift or you inherit them, you might have to pay taxes then.

You buy a government bond and earn $100 in interest this year.

You don’t have to pay state taxes on that $100, unless you got the bond as a gift or inheritance.