Nontaxable Dividends
Dividends from a mutual fund or some other regulated investment company that are not taxed. Taxes are not paid out because the fund invests in municipal and other tax exempt investments.

Investopedia Says:
The mutual fund must invest over 50% of its capital into tax exempt investments for the dividends to be classified as nontaxable.

Related Terms:
Capital Gain
Capital Loss
Dividend
Municipal Bond
Taxable Gain

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