Tax Anticipation Note - TAN

Dictionary Says

Definition of 'Tax Anticipation Note - TAN'

A short-term debt security issued by a state or local government to finance an immediate project that will be repaid with future tax collections. State and local governments use tax anticipation notes to borrow money, typically for one year or less and at a low interest rate, in order to finance a capital expenditure such as the construction of a road or school. The government then uses the following year's tax revenue to repay the TANs.
Investopedia Says

Investopedia explains 'Tax Anticipation Note - TAN'

Tax anticipation note financing helps governments smooth out the ups and downs in their revenue cycles, if the timing of their receipts does not match the timing of their expenditures. TANs are one of several types of anticipation note that state and local governments can use; others include revenue anticipation notes, tax and revenue anticipation notes and bond anticipation notes. Tax anticipation notes are a type of municipal bond, so the interest earned from TANs is generally tax exempt for investors.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Bond

    A debt ...
  2. Bond Anticipation Note - BAN

    A short-term ...
  3. Revenue Anticipation Note - RAN

    A municipal bond ...
  4. Construction Loan Note - CLN

    A short-term ...
  5. Demand Note

    A loan with no ...
  6. Anticipation Note

    A short-term ...
  7. Bridge Loan

    A short-term ...
  8. Agency Bond

    A bond issued by ...
  9. Convertible Arbitrage

    An investing ...
  10. Liquidation

    1. When a ...

Articles Of Interest

  1. The Basics Of Municipal Bonds

    Investing in these bonds may offer a tax-free income stream but they are not without risks.
  2. Weighing The Tax Benefits Of Municipal Securities

    Find out how to determine whether the tax exemption offered by "munis" benefits you.
  3. This Is Your Brain On Stocks

    Find out how the human mind can hurt investors' portfolios.
  4. Should You Invest Your Entire Portfolio In Stocks?

    It is true that stocks outperform bonds and cash in the long run, but that statistic doesn't tell the whole story.
  5. 5 Tips For Diversifying Your Portfolio

    A diversified portfolio will protect you in a tough market. Get some solid tips here!
  6. 5 Popular Portfolio Types

    Learning how to build these portfolios will increase your investing confidence and give you financial control.
  7. How To Invest When You're Deep In Debt

    Debt is one of the biggest obstacles that prevents people from investing - but it shouldn't be.
  8. Finding Your Investing Comfort Zone

    Choosing the right investments for you is the best way to feel comfortable with your portfolio.
  9. Investors: Rely On Your Gut

    Find out how your personality and natural instincts can direct your investment choices.
  10. The Fundamental Mechanics Of Investing

    Here's a story that demonstrates why stocks and bonds were created and how they are valued.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center