tax-exempt

adjective

tax-ex·​empt ˌtaks-ig-ˈzem(p)t 

1

: exempted from a tax

2

: bearing interest that is free from federal or state income tax

Examples of tax-exempt in a Sentence

Recent Examples on the Web

The board was to vote on whether to approve the project and issue tax-exempt revenue bonds to fund it. —Lev Akabas, Sportico.com, 27 Feb. 2026

In contrast to private companies, the board members of tax-exempt charitable nonprofits cannot take a share of earnings. —Catherina Gioino, Fortune, 23 Feb. 2026

That essentially means a semipublic, standalone agency that is currently pursuing tax-exempt status. —Dave Boucher, Freep.com, 22 Feb. 2026

How much of people’s Social Security benefits will get taxed depends on the total amount of their income, including tax-exempt interest like from a municipal bond, plus one-half of their Social Security benefits for the taxable year. —Medora Lee, USA Today, 20 Feb. 2026

Word History

First Known Use

1923, in the meaning defined at sense 1

Rhymes for tax-exempt

• nonexempt
• attempt
• contempt
• exempt
• preempt
• unkempt
• empt
• tempt

Legal Definition

tax-exempt

adjective

1

: exempted from taxation

also : based on such exemption

tax-exempt status

2

: providing interest or income that is exempted from taxation

a tax-exempt municipal bond