WASHINGTON -- Numerous bond industry officials blasted the Internal Revenue Service yesterday for taxing the interest earnings from a 1984 escrow bond deal and expressed fear the action would cause investors to lose confidence in the municipal market.

The criticism came in the wake of news that the IRS slapped the estate of a deceased investor, Dr. Joseph Jarabak, with a bill for $6,232 in taxes on the interest earned from about $300,000 of tax-exempt bonds he purchased in 1985.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.