Code Section 852(b)(4)

Code Section	Effective Date	Name of Act	Name of Provision
852(b)(4)	* 12/22/2010	Regulated Investment Company Modernization Act of 2010	Exception to Holding Period Requirement for Exempt-Interest Dividends Declared on Daily Basis

* Notes on Effective Date

The provision applies to stock for which the taxpayer’s holding period begins after the date of enactment (December 22, 2010).

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Exception to Holding Period Requirement for Exempt-Interest Dividends Declared on Daily Basis

Explanation of Provision

The provision makes the loss disallowance rule inapplicable, except as otherwise provided by regulations, with respect to a regular dividend paid by a RIC that declares exempt-interest dividends on a daily basis in an amount equal to at least 90 percent of its net tax-exempt interest and distributes the dividends on a monthly or more frequent basis.

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