Defined Asset Funds[SM]
Municipal
Investment
Trusts
Maryland
300 Series
Merrill Lynch
Imagine This -- Twelve Times A Year, Uncle Sam Gives Maryland Residents A Nice
Little Present.
Uncle Sam and the State of Maryland let you keep all of the investment income
you've earned completely free of regular federal tax and Maryland personal
income taxes. Sound too good to be true? Not if you put your money into
Defined Asset Funds[SM] Municipal Investment Trusts Maryland Series.
Over the years, rounds of tax reform have eliminated many of the ways Maryland
residents reduce their tax bill. Municipal bonds have remained a significant
source of tax-free income. For more than ten years, Maryland investors have
been adding balance to their portfolios, while lessening their tax burden with
Defined Asset Funds[SM] Municipal Investment Trusts.
A Tax-Free Check Every Month
Defined Asset Funds[SM] Municipal Investment Trusts Maryland Series invest in
Maryland municipal bonds that help finance projects such as roads, schools,
water systems and health care facilities. The monthly income you receive from
them is 100% federally and Maryland tax exempt--which means you get to keep
more of what you've earned.
It's Straightforward and Simple
With Defined Asset Funds Municipal Investment Trusts, your investment is
straightforward. With our Funds, you have the comfort of knowing which bonds
are in the Fund, when they are scheduled to mature, and what you may earn each
month--all before you buy. It's that simple!
"Buy and Hold" for Value
The "buy and hold" philosophy of a Defined Municipal Investment Trust can be
an efficient alternative to investing in an actively managed municipal bond
fund. While every investment has inherent risks, historically municipal bonds
have been considered second in credit safety only to U.S. government
securities. Simply put, active management may not be as necessary for a
portfolio of quality municipal bonds.
Reduced Risk Through Diversification
Defined Asset Funds team of experienced buyers selects a number of bonds for
each Municipal Investment Trust, with an eye toward quality. Holding several
different bonds, instead of just one, helps to diversify your investment and
spread out your risk. Achieving a comparable level of diversification by
buying individual bonds could require an investment many times larger.
You Earn Income Every Month
Our Municipal Investment Trusts distribute annual net income in 12
approximately equal payments--unlike most bonds which pay interest only twice
a year. Your monthly interest payments aren't necessarily affected by changes
in prevailing interest rates. Payments vary somewhat as bonds are sold,
called or mature, or if Fund expenses change.
Reinvestment Option
Reinvesting helps to compound your income tax-free. You can elect to
automatically reinvest your distributions into a separate Portfolio of
federally tax-exempt bonds at no additional sales charge. However, income
from the reinvestment Portfolio may not be fully exempt from Maryland
taxes.
Tax-Free Yield vs. Taxable Yield
Find out what a tax-free yield is really worth to you. High yields on many
investments look attractive, but it's what you earn after taxes that counts.
Depending on your income bracket, a tax-free yield may actually be worth more
dollars in your pocket than a higher taxable yield.
The income paid by most Maryland municipal bonds is exempt from regular
federal and Maryland personal income taxes for non-corporate investors. Some
of the income may be subject to Alternative Minimum Tax (AMT).
To compare the yield of a municipal bond to an investment subject to federal
income taxes, use the chart below to figure out the "taxable equivalent
yield."
<PAGE>
<TABLE>
<CAPTION>
A Comparison of Taxable and Tax-Free Yields
Then This Tax-Free Yield of
is Your ------------------------------------------------------------------------------
Combined 4% 4.5% 5% 5.5% 6% 6.5% 7% 7.5% 8%
Effective ------------------------------------------------------------------------------
Find Your Reportable Taxable Income*: Tax Rate % Is Equivalent To A Taxable Yield Of
- ---------------------------------------------------------------------------------------------------------------------------------
Single Return Joint Return
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$24,000-58,149 $40,100-96,899 31.60 5.85 6.58 7.31 8.04 8.77 9.50 10.23 10.96 11.70
- ---------------------------------------------------------------------------------------------------------------------------------
$58,150-121,299 $96,900-147,699 34.45 6.10 6.86 7.63 8.39 9.15 9.92 10.68 11.44 12.20
- ---------------------------------------------------------------------------------------------------------------------------------
$121,300-263,749 $147,700-263,749 39.20 6.58 7.40 8.22 9.05 9.87 10.69 11.51 12.34 13.16
- ---------------------------------------------------------------------------------------------------------------------------------
$263,750-Over $263,750-Over 42.62 6.97 7.84 8.71 9.59 10.46 11.33 12.20 13.07 13.94
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
To compare the yield of a taxable security with the yield of a tax-free
security, find your taxable income and read across. This table incorporates
1997 federal and Maryland personal income tax rates and assumes that all
income would otherwise be taxed at the investor's highest tax rate. Yield
figures are for example only.
* Based upon net amount subject to federal income tax after deductions and
exemptions. This table does not reflect other possible tax factors such as
AMT, personal exemptions, the phase-out of exemptions, itemized deductions or
the possible partial disallowance of deductions. You are urged to consult
your own tax advisor in this regard.
Defined Advantages
Professional Selection
Our team of professional buyers is responsible for selecting the bonds for
every Municipal Investment Trust. Only those issues that meet our research
analysts' stringent criteria are included.
Diversification
The Portfolio is diversified among several bond issuers. Spreading your
investment helps to reduce your risk.
Return of Principal
Principal from sales, calls and maturities of bonds in the Portfolio will be
distributed to you periodically when the amount is more than $5.00 per unit.
Defining Your Costs
If you buy units within the first 45 days of the initial offering period, all
of your sales charge will be deferred. This means more of your investment
dollars are put to work for you. You'll pay a total of $15 per year for three
years on about $1,000 invested. After three years, there will be no further
sales charge.
You Can Cash In Your Investment Any Time
Your investment can be sold any time. The price you receive will be based on
the net asset value when you sell, which may be more or less than you paid
initially due to sales charges, market fluctuations and other factors. If you
sell your investment before the third anniversary of the Fund, you will pay
the remaining balance of your $45 deferred sales charge (based on a $1,000
investment).
Credit Safety of Insured Bonds
The bonds in some Portfolios are insured. This insurance guarantees the timely
payment of principal and interest of the bonds in the Fund, but not the Fund
as a whole. However, insurance does not remove market risk and is subject to
the insurers' ability to meet their commitments. Terms of the insurance are
more fully described in the prospectus.
You Could Be Earning Tax-Free Income Right Now!
You can get started right now with as little as $1,000. Get the most out of
your investment and reduce your tax burden by investing in Defined Asset
Funds-- Maryland Trusts. Contact your financial professional for a free
prospectus containing more complete information on any Defined Municipal
Investment Trust, including all charges and expenses. Read the prospectus
carefully before investing.
Other Tax-Free
Defined Asset Funds
Municipal Investment Trust Funds
o Insured Series
o Intermediate Series
o Investment Grade Series
o National Series
o State Series
Other Defined Asset Funds
Corporate Income Funds
Government Securities Income Funds
International Bond Funds
Equity Income Funds Utility Series
15th Utility Common Stock Series
Index Series
S&P 500 Index Trust 2
S&P MidCap Index Trust
Concept Series
Premier American Portfolio
Health Care Trust II
Tele-Global Trust 2
Real Estate Income Fund 2
Select Series
Select Ten Portfolio (DJIA)
Hong Kong Portfolio (Hang Seng Index)
United Kingdom Portfolio (Financial Times Index)
Japan Portfolio (Nikkei 225 Index)
Select Growth Portfolio
Select S&P Intrinsic Value Portfolio
Select S&P Industrial Portfolio
Information contained herein is subject to amendment. A registration statement
relating to the securities of the next series has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This brochure shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these
securities in any state in which such an offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state.
(Seal) Printed on Recycled Paper 11582BR-2/97
[Copyright] 1997 Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Member SIPC.
