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Subject:  Can anyone clarify? Date:  12/11/2006  5:24 PM
Author:  blearynet Number:  19065 of 36389

If the income on Tbills is taxed as interest, not dividends, then it does not qualify for the 15% rate (unless one is in the 15% bracket). Is this correct?

So is it better to NOT purchase individual Tbills, and use a bond fund instead, because this is taxed at the dividend rate of 15% ?? We are in the 28% tax bracket, and in the 9.3% state income tax bracket. I had been moving into Tbills because they are exempt from state tax. However, now I am wondering if this is a big mistake.
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