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Abstract
Recently, the Internal Revenue Service (IRS) has released a revenue procedure and field service advice (FSA) 200216005 of interest to certain partnerships. In Rev. Proc. 2002-16, the IRS provides guidance for eligible tax-exempt bond partnerships to elect to close their books monthly so that eligible partners who are regulated investment companies (RICs) that invest in the partnerships can recognize income monthly, rather than on the last day of a partnership's tax year. This revenue procedure validates a practice that has been in use for years. Although Rev. Proc. 2002-16 does not break any new ground, its release should have a positive effect on tax-exempt money market funds. The monthly closing election also would apply to tax-exempt money market funds in a master-feeder structure.