0000758003 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:C000005558Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:C000177208Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:C000117193Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member rr:AfterTaxesOnDistributionsMember cik0000758003:C000005558Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member rr:AfterTaxesOnDistributionsAndSalesMember cik0000758003:C000005558Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:Bloomberg65High-Grade35High-YieldIndex1Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:Bloomberg65High-Grade35High-YieldIndex2Member 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:LipperHighYieldMunicipalDebtFundsAverageMember 2023-02-28 2023-02-28 0000758003 cik0000758003:S000002162Member cik0000758003:LipperHighYieldMunicipalDebtFundsAverage3Member 2023-02-28 2023-02-28 iso4217:USD pure utr:Y T. Rowe Price Tax-Free High Yield Fund, Inc. 2023-07-01 Tax-Free High Yield Fund Investment Objective(s) The fund seeks to provide a high level of income exempt from federal income taxes by investing primarily in long-term low- to upper-medium-grade municipal securities. Fees and Expenses This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the fund. You may also incur brokerage commissions and other charges when buying or selling shares of the fund, which are not reflected in the table or example below. Shareholder fees (fees paid directly from your investment) 20 0 0 Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) 0.0059 0.0059 0.0059 0 0 0.0025 0.0018 0.0004 0.0019 0.0077 0.0063 0.0103 -0.0010 -0.0010 -0.0010 0.0067 0.0053 0.0093 Example This example is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes that you invest $10,000 in the fund for the time periods indicated and then redeem all of your shares at the end of those periods, that your investment has a 5% return each year, and that the fund’s operating expenses remain the same. The example also assumes that any current expense limitation arrangement remains in place for the period noted in the previous table; therefore, the figures have been adjusted to reflect fee waivers or expense reimbursements only in the periods for which the expense limitation arrangement is expected to continue. Although your actual costs may be higher or lower, based on these assumptions your costs would be: 68 236 418 945 54 192 341 777 95 318 559 1250 Portfolio Turnover The fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when the fund’s shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the fund’s performance. During the most recent fiscal year, the fund’s portfolio turnover rate was 19.7% of the average value of its portfolio. 0.197 Principal Investment Strategies Although the fund may purchase securities of any maturity, the fund invests primarily in longer-term municipal securities. The fund generally seeks higher-yielding municipal bonds, including those that are rated below investment grade (BB and lower, or an equivalent rating) by a major credit rating agency or by T. Rowe Price, known as “junk” bonds. T. Rowe Price’s active investment management approach emphasizes the value of in-depth fundamental credit research, diversification, and risk management practices. By using fundamental research, T. Rowe Price seeks to select investments for the fund’s portfolio based on its outlook for the different sectors of the tax-free municipal market (for example, T. Rowe Price may emphasize revenue bonds instead of state and local general obligation debt) and specific issuers or securities. The goal of this approach is to seek higher yields while taking a risk-conscious approach. Risk management practices include managing the fund’s duration (which is a measurement of the price sensitivity of a bond or bond fund to changes in interest rates), while also focusing on striking a balance between (i) investing more heavily in certain sectors or issuers and (ii) diversifying the fund’s investments across the broader municipal market.Normally, at least 80% of the fund’s income will be exempt from federal income taxes. However, up to 20% of the fund’s income could be derived from securities subject to the alternative minimum tax. From time to time, the fund may invest a significant portion of its assets in sectors with special risks, such as health care, transportation, utilities, or private activity bonds. Principal Risks As with any fund, there is no guarantee that the fund will achieve its objective(s). The fund’s share price fluctuates, which means you could lose money by investing in the fund. The principal risks of investing in this fund, which may be even greater in bad or uncertain market conditions, are summarized as follows:Municipal securities The fund may be highly impacted by events tied to the overall municipal securities markets, which can be very volatile and significantly affected by unfavorable legislative or political developments and adverse changes in the financial conditions of municipal securities issuers and the global, national, and/or local economies. Income from municipal securities held by the fund could become taxable because of changes in tax laws or interpretations by taxing authorities, or noncompliant conduct of a state or municipality. Other changes in tax laws, including changes to individual or corporate tax rates, could alter the attractiveness and overall demand for municipal bonds. Certain sectors of the municipal bond market have special risks and could be affected by certain developments more significantly than the market as a whole. For example: health care can be negatively impacted by rising expenses and dependency on third party reimbursements; transportation can be negatively impacted by declining revenues or unexpectedly high construction or fuel costs; utilities are subject to governmental rate regulation; and private activity bonds (including industrial development bonds) rely on project revenues and the creditworthiness of the corporate user as opposed to governmental support. Investing significantly in municipal obligations backed by revenues of similar types of industries or projects may make the fund more susceptible to developments affecting those industries and projects. If the fund invests a substantial amount of its assets in issuers located in a single region, state, or city, there is an increased risk that environmental, economic, political, and social conditions in those regions will have a significant impact on the fund’s investment performance.Market conditions The value of the fund’s investments may decrease, sometimes rapidly or unexpectedly, due to factors affecting an issuer held by the fund, particular industries, or the overall securities markets. A variety of factors can increase the volatility of the fund’s holdings and markets generally, including economic, political, or regulatory developments, recessions, inflation, rapid interest rate changes, war, military conflict, acts of terrorism, natural disasters, and outbreaks of infectious illnesses or other widespread public health issues such as the coronavirus pandemic and related governmental and public responses (including sanctions). Certain events may cause instability across global markets, including reduced liquidity and disruptions in trading markets, while some events may affect certain geographic regions, countries, sectors, and industries more significantly than others. Government intervention in markets may impact interest rates, market volatility, and security pricing. These adverse developments may cause broad declines in market value due to short-term market movements or for significantly longer periods during more prolonged market downturns.Credit quality An issuer of a debt instrument could suffer an adverse change in financial condition that results in a payment default (failure to make scheduled interest or principal payments), rating downgrade, or inability to meet a financial obligation. Securities that are rated below investment grade carry greater risk of default and should be considered speculative. Economic downturns often result in reduced levels of taxes collected and revenues earned by municipalities and insufficient funding to meet pension or health care obligations, which could lessen the overall financial strength of a municipality and increase the credit risk of the securities it issues. The fund’s credit risk is increased to the extent it invests in securities that are not backed by the taxing power of the municipal issuer.Junk investing Investments in bonds that are rated below investment grade, commonly referred to as junk bonds, expose the fund to greater volatility and credit risk than investments in bonds that are rated investment grade. Issuers of junk bonds are usually not as strong financially and are more likely to suffer an adverse change in financial condition that would result in the inability to meet a financial obligation. As a result, bonds rated below investment grade carry a higher risk of default and should be considered speculative.Interest rates The prices of, and the income generated by, debt instruments held by the fund may be affected by changes in interest rates. A rise in interest rates typically causes the price of a fixed rate debt instrument to fall and its yield to rise. Conversely, a decline in interest rates typically causes the price of a fixed rate debt instrument to rise and the yield to fall. The prices and yields of inflation-linked bonds are directly impacted by the rate of inflation as well as changes in interest rates. Generally, funds with longer weighted average maturities and durations carry greater interest rate risk. Changes in monetary policy made by central banks and/or governments, such as the discontinuation and replacement of benchmark rates, are likely to affect the interest rates or yields of the securities in which the fund invests.Callable bonds While a rise in interest rates is the principal source of interest rate risk for bond funds, falling rates bring the possibility that a bond may be “called,” or redeemed before maturity, and that the proceeds may need to be reinvested in lower-yielding securities.Alternative minimum tax Although the fund seeks to distribute tax-exempt income, a portion of the fund’s otherwise tax-exempt dividends may be taxable to those shareholders subject to the federal alternative minimum tax. Liquidity The fund may not be able to sell a holding in a timely manner at a desired price. Reduced liquidity in the bond markets can result from a number of events, such as limited trading activity, reductions in bond inventory, and rapid or unexpected changes in interest rates. The secondary market for certain municipal bonds tends to be less developed and less liquid than many other bond markets. Less liquid markets could lead to greater price volatility and limit the fund’s ability to sell a holding at a suitable price.Active management The fund’s overall investment program and holdings selected by the fund’s investment adviser may underperform the broad markets, relevant indices, or other funds with similar objectives and investment strategies.Cybersecurity breaches The fund could be harmed by intentional cyberattacks and other cybersecurity breaches, including unauthorized access to the fund’s assets, customer data and confidential shareholder information, or other proprietary information. In addition, a cybersecurity breach could cause one of the fund’s service providers or financial intermediaries to suffer unauthorized data access, data corruption, or loss of operational functionality. The fund’s share price fluctuates, which means you could lose money by investing in the fund. Performance The following performance information provides some indication of the risks of investing in the fund. The fund’s performance information represents only past performance (before and after taxes) and is not necessarily an indication of future results.The following bar chart illustrates how much returns can differ from year to year by showing calendar year returns and the best and worst calendar quarter returns during those years for the fund’s Investor Class. Returns for other share classes vary since they have different expenses. The following performance information provides some indication of the risks of investing in the fund. The following bar chart illustrates how much returns can differ from year to year by showing calendar year returns and the best and worst calendar quarter returns during those years for the fund’s Investor Class. Returns for other share classes vary since they have different expenses. The following table shows the average annual total returns for each class of the fund that has been in operation for at least one full calendar year, and also compares the returns with the returns of a relevant broad-based market index, as well as with the returns of one or more comparative indexes that have investment characteristics similar to those of the fund, if applicable. The fund’s performance information represents only past performance (before and after taxes) and is not necessarily an indication of future results. Calendar Year Returns <table cellpadding="0" cellspacing="0" style="border-collapse:collapse" width="100%"><tr style="font-size:1pt;"><td style="width:9.02%;"> </td><td style="width:14.01%;"> </td><td style="width:14.99%;"> </td><td style="width:13%;"> </td><td style="width:.49%;"> </td><td style="width:14.99%;"> </td><td style="width:14.99%;"> </td><td style="width:13%;"> </td><td style="width:5.5%;"> </td></tr><tr><td style="vertical-align:top; font-size:1pt;"> </td><td style="vertical-align:top; font-size:1pt;"> </td><td style="vertical-align:top;">Quarter Ended</td><td style="vertical-align:top;">Total Return</td><td style="vertical-align:top; font-size:1pt;"> </td><td style="vertical-align:top; font-size:1pt;"> </td><td style="vertical-align:top;">Quarter Ended</td><td style="vertical-align:top;">Total Return</td><td style="vertical-align:top; font-size:1pt;"> </td></tr><tr><td style="vertical-align:top; font-size:1pt;"> </td><td style="vertical-align:top; background-color:#E6E6E6;">Best Quarter</td><td style="vertical-align:top; background-color:#E6E6E6;">3/31/14</td><td style="vertical-align:top; background-color:#E6E6E6;">5.58%</td><td style="vertical-align:top; font-size:1pt;"> </td><td style="vertical-align:top; background-color:#E6E6E6;">Worst Quarter</td><td style="vertical-align:top; background-color:#E6E6E6;">3/31/22</td><td style="vertical-align:top; background-color:#E6E6E6;">-6.34%</td><td style="vertical-align:top; font-size:1pt;"> </td></tr></table> Best Quarter 2014-03-31 0.0558 Worst Quarter 2022-03-31 -0.0634 The fund’s return for the three months ended 3/31/23 was 2.62%. The fund’s return for the three months ended 2023-03-31 0.0262 The following table shows the average annual total returns for each class of the fund that has been in operation for at least one full calendar year, and also compares the returns with the returns of a relevant broad-based market index, as well as with the returns of one or more comparative indexes that have investment characteristics similar to those of the fund, if applicable.In addition, the table shows hypothetical after-tax returns to demonstrate how taxes paid by a shareholder may influence returns. After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor’s tax situation and may differ from those shown. After-tax returns shown are not relevant to investors who hold their fund shares through tax-deferred arrangements, such as a 401(k) account or an IRA. After-tax returns are shown only for the Investor Class and will differ for other share classes. After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor’s tax situation and may differ from those shown. After-tax returns shown are not relevant to investors who hold their fund shares through tax-deferred arrangements, such as a 401(k) account or an IRA. After-tax returns are shown only for the Investor Class and will differ for other share classes. Average Annual Total Returns Periods ended December 31, 2022 1985-03-01 -0.1358 0.0079 0.0258 -0.1361 0.0077 0.0257 -0.0674 0.0145 0.0288 2016-11-29 -0.1347 0.0090 0.0199 2012-08-08 -0.1390 0.0046 0.0229 Bloomberg 65% High-Grade/35% High-Yield Index (reflects no deduction for fees, expenses, or taxes) reflects no deduction for fees, expenses, or taxes -0.1014 0.0176 0.0262 0.0277 Lipper High Yield Municipal Debt Funds Average -0.1343 0.0090 0.0246 0.0209 Updated performance information is available through troweprice.com. troweprice.com 485BPOS 2023-02-28 0000758003 false 2023-06-29 2023-07-01 N-1A -0.0451 0.1499 0.0385 0.0138 0.073 0.0065 0.0902 0.0338 0.0608 -0.1358 ~ http://troweprice.com/20230228/role/RRSchedule4 ~ ~ http://troweprice.com/20230228/role/RRSchedule5 ~ ~ http://troweprice.com/20230228/role/RRSchedule6 ~ ~ http://troweprice.com/20230228/role/RRBarChart7 ~ ~ http://troweprice.com/20230228/role/RRSchedule8 ~ June 30, 2024 June 30, 2024 June 30, 2024 Restated to reflect current fees. Restated to reflect current fees. Subject to certain exceptions, accounts with a balance of less than $10,000 are charged an annual $20 fee. T. Rowe Price Associates, Inc., has contractually agreed (at least through June 30, 2024) to waive a portion of the fund’s management fees in order to limit the fund’s management fees to 0.49% of the fund’s average daily net assets. Thereafter, this agreement will automatically renew for one-year terms unless terminated or modified by the fund’s Board of Directors. Any fees waived under this agreement are not subject to reimbursement to T. Rowe Price Associates, Inc., by the fund. Restated to reflect current fees. Return since 11/30/16.