26 U.S.C. § 103 - U.S. Code - Unannotated Title 26. Internal Revenue Code § 103. Interest on State and local bonds

(a) Exclusion. --Except as provided in subsection (b), gross income does not include interest on any State or local bond.

(b) Exceptions. --Subsection (a) shall not apply to--

(1) Private activity bond which is not a qualified bond. --Any private activity bond which is not a qualified bond (within the meaning of section 141 ).

(2) Arbitrage bond. --Any arbitrage bond (within the meaning of section 148 ).

(3) Bond not in registered form, etc. --Any bond unless such bond meets the applicable requirements of section 149 .

(c) Definitions. --For purposes of this section and part IV--

(1) State or local bond. --The term “State or local bond” means an obligation of a State or political subdivision thereof.

(2) State. --The term “State” includes the District of Columbia and any possession of the United States.

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