XXXXXX XXXX & XXXXXX LLP
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January 17, 2002
First Investors Multi-State
Insured Tax Free Fund
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: First Investors Multi-State Insured
Tax Free Fund Connecticut Series
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Gentlemen:
You have requested our opinion regarding the taxability of certain
distributions from the First Investors Connecticut Insured Tax Free Series (the
"Connecticut Series"), a separate, designated series of the First Investors
Multi-State Insured Tax Free Fund (the "Fund"), for purposes of the Connecticut
personal income tax in the case of individual investors and the corporation
business tax in the case of corporate investors.
You have advised us that the Connecticut Series will invest primarily
in tax-exempt obligations issued by or on behalf of the State of Connecticut,
its municipal governments and public authorities ("Connecticut Obligations"),
and tax-exempt obligations issued by territories and possessions of the United
States or of other states, their municipal governments and public authorities,
the interest of which is exempt from Federal income taxes ("Other Exempt
Obligations").
The Fund is an open-end management company organized as a business
trust under the laws of the Commonwealth of Massachusetts. You have advised us
that the Connecticut Series intends to qualify and thereafter continue to
qualify as a regulated investment company as defined in Section 851 of the
Internal Revenue Code of 1986, as amended (the "Code"), and be eligible to pay
"exempt-interest dividends" as provided in Section 852(b)(5) of the Code.
XXXXXX XXXX & XXXXXX LLP
First Investors Multi-State -2- January 17, 2002
Insured Tax Free Fund
In furnishing this opinion, we have reviewed such provisions of
Connecticut law as we deemed appropriate. In addition, we have reviewed the
Fund's Amended and Restated Declaration of Trust dated September 22, 1994, the
Prospectus for the Fund dated May 1, 2001, and the Statement of Additional
Information dated May 1, 2001.
We have assumed for purposes of this opinion that the Connecticut
Series will qualify for treatment as a regulated investment company under
Subchapter M of the Code.
Based upon the foregoing, we are of the opinion that under existing law
applicable to shareholders of the Connecticut Series:
1. Shareholders of the Connecticut Series who are otherwise subject to
the Connecticut personal income tax imposed on individuals will not be subject
to such tax on distributions with respect to shares of the Connecticut Series to
the extent that such distributions qualify as either (a) "exempt-interest
dividends" (as defined in Section 852(b)(5) of the Code) attributable to
interest on Connecticut Obligations or (b) "exempt dividends" for Connecticut
income tax purposes.
2. Shareholders of the Connecticut Series who are otherwise subject to
the Connecticut personal income tax imposed on individuals will be subject to
such tax on distributions with respect to shares of the Connecticut Series to
the extent that such distributions are other than (i) distributions that are
"exempt interest dividends" for federal income tax purposes attributable to
interest on Connecticut Obligations or (ii) "exempt dividends" for Connecticut
income tax purposes. Such shareholders will also be subject to the Connecticut
personal income tax with respect to gains resulting from the redemption or sale
of shares in the Connecticut Series.
3. Shareholders of the Connecticut Series that are otherwise subject to
the Connecticut corporation business tax computed on the net income basis must
include in income distributions with respect to shares of the Connecticut Series
and gains resulting from the redemption or sale of shares of the Connecticut
Series. However, such shareholders may deduct in computing net income 70 percent
of such distributions that qualify as dividends under Section 316 of the Code.
Such shareholders who own 20 percent or more of the shares of the Connecticut
Series may deduct, in computing net income, 100 percent of such distributions.
We have not examined any of the obligations to be acquired by the
Connecticut Series and express no opinion as to whether such obligations,
interest thereon, or gain from the sale or other disposition thereof are in fact
exempt from any Federal or Connecticut taxes. Moreover, we express no opinion as
to whether distributions with respect to the Connecticut Series that are
attributable to interest on Other Exempt Obligations, the taxation of which is
prohibited by federal law, are subject to the Connecticut personal income tax.
XXXXXX XXXX & XXXXXX LLP
First Investors Multi-State -3- January 17, 2002
Insured Tax Free Fund
We consent to the inclusion of this opinion as an exhibit to the
post-Effective Amendment No. 27 to the Fund's Registration Statement filed with
the Securities and Exchange Commission and the applications and registration
statements filed in accordance with the securities laws of the several states in
which shares of the Connecticut Series are to be offered, and we further consent
to the reference in the Prospectus to the fact that this opinion has been
rendered.
Very truly yours,
XXXXXX XXXX & XXXXXX LLP
By: /s/ Xxxxxxx X. Xxxxxxx
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