You can invest in any state but yes tax-free for the state you live in. Check http://www.cefconnect.com/closed-end-funds-screener http://www.cefconnect.com/clo

You can invest in any state but yes tax-free for the state you live in. Check http://www.cefconnect.com/closed-end-funds-screener http://www.cefconnect.com/closed-end-funds-screener and choose tax free. I see a few in NJ over 5%: MUJ, MYJ, NXJ. NXJ is at a 10% discount. I've been basically doing those Nuveen & Blackrock equivalents in CA. I usually go for discount to net asset value so I feel like it has room to appreciate so I can lock in a gain outside of the monthly dividends. And if they go down you can always scoop up more which will then have a higher annual dividend yield.