Build America Bonds
Build America Bonds (BABs) are federally taxable, state tax-exempt municipal bonds. Build America Bonds are debt securities issued by a state, municipality or county to finance capital expenditures. Like municipal bonds, these bonds are secured by the municipality that issues the bonds. These bonds were only issued for a certain time period, so availability in the secondary market is limited.
There are two kinds of Build America Bonds (BABs):
Tax Credit BABs
- BABs issuers receive a subsidy from the federal government. (More popular and is the structure for most BABs)
Direct Payment BABs
- BABs holders receive a tax credit equal to 35% of the interest on the bond each year from the federal government
ACAP Trading offers primary and secondary liquidity on BABs and offerings can be found on B.O.L.T.S.™. To view our Bonds On-Line Trading System™, please click here.