Tax free bonds are a popular investment choice among conservative investors looking to earn steady interest income without the burden of taxation. Usually issued by government-backed entities, these bonds offer fixed interest payments, and the returns are exempt from income tax, making them particularly attractive for individuals in higher tax brackets. This blog explains what tax-free bonds are, who issues them, and how they compare with other fixed-income instruments. We’ll also explore the benefits, such as safety and tax efficiency, as well as the limitations like limited liquidity and lower returns compared to taxable options.