Series 52: 1.2.1.2. Limited Tax General Obligation Bonds

1.2.1.2. Limited Tax General Obligation Bonds

General obligation bonds are often unlimited tax bonds, meaning the issuer has no legal limitation on its power to tax. If a state or local government needs more money to make payment on its bonds, it can raise taxes in sufficient amounts to get it. Some government entities, however, particularly municipalities and school districts, may have a legal limit on the tax rate they can levy. Municipal bonds by such government entities are called limited tax bonds. They are still guaranteed by the full faith and credit of the municipal government, but its revenue sources are constrain