Glossary

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Marginal Tax Bracket

The range of taxable income that is taxable at a certain rate. Currently, there are six marginal tax brackets: 10 percent, 15 percent, 25 percent, 28 percent, 33 percent, and 35 percent.

Marital Deduction

A provision of the tax codes that allows all assets of a deceased spouse to pass to the surviving spouse free of estate taxes. This provision is also referred to as the unlimited marital deduction.

Money Market Fund

A mutual fund that specializes in investing in short-term securities and that tries to maintain a constant net asset value of $1.

Municipal Bond

A debt security issued by municipalities. The income from municipal bonds is usually exempt from federal income taxes. In many states, it is also exempt from state income taxes in the state in which the municipal bond is issued.

Municipal Bond Fund

A mutual fund that specializes in investing in municipal bonds.

Mutual Fund

A collection of stocks, bonds, or other securities purchased and managed by an investment company with funds from a group of investors.