Interest from certain bonds, notes, etc. (commonly know as municipal bonds) issued by non-federal government entities outside Utah are subject to Utah's income tax if obtained after January 1, 2003. However, interest earned on non-Utah municipal bonds is not subject to Utah income tax if the issuing state (or political subdivision) does not impose an income tax on bonds issued by Utah.
Interest earned from municipal bonds are not added back to Utah taxable income. See UC §59-10-114(5) for more information
Fiduciary fees and other investment expenses associated with municipal bonds are not deductible from Utah income. See UC §59-10-114(1)(e).
The following states and political subdivisions do not impose an income tax on Utah municipal bonds. Accordingly, interest earned on bonds, notes, etc. issued by one of these jurisdictions is not subject to Utah income tax. If you believe a jurisdiction qualifies for the reciprocity exception and is not listed, please contact us at 801-297-7705 or 1-800-662-4335, ext. 7705 (toll free outside the Salt Lake area).
