Part III. Administrative, Procedural, and Miscellaneous

(1) Shall be allocated and shall pay an advisory fee and other fees and expenses related to the management of the RIC’s assets (including custodial fees and tax return preparation fees) on the basis of the net asset value of the Qualified Group in relation to the net asset value of the RIC, except as described in paragraph (2); and

(2) May be allocated and may pay a different advisory fee to the extent that any difference in amount paid is the result of the application of the same performance fee provisions in the advisory contract to the different investment performance of each Qualified Group.

.04 The rights and obligations of the shareholders of each Qualified Group are set forth in the RIC’s organizing documents. Except as otherwise provided in this revenue procedure, each Qualified Group is entitled to distributions calculated under those documents in the same manner and at the same time as all other Qualified Groups. For purposes of this calculation, fees and expenses are allocated under those documents to each Qualified Group at the same time as to all other Qualified Groups. Organizing documents are documents of the RIC that fix the rights and obligations between the

Reporting of Gross Proceeds Payments to Attorneys

Notice 99–53

This notice informs taxpayers that the Internal Revenue Service intends to delay for one year the effective date of the regulations proposed under § 6045 of the Internal Revenue Code (relating to the reporting of payments of gross proceeds to attorneys). The notice of proposed rulemaking (NPRM) was published in the Federal Register on May 21, 1999 (64 F.R. 27730), 1999–23 I.R.B. 14 (REG– 105312–98). Section 1.6045–5(h) of the proposed Income Tax Regulations provides that the rules in § 1.6045–5 apply to payments made after December 31, 1999.

The Service has received many comments requesting that the effective date of the regulations be delayed and believes that a delayed effective date for the regulations is appropriate under the circumstances. Accordingly, when finalized, the rules in § 1.6045–5 will apply to payments made after December 31, 2000. Nevertheless, payments of gross proceeds to attorneys made after December 31, 1997, are and continue to be reportable on Form 1099-MISC pursuant to § 6045(f).

The principal author of this notice is A. Katharine Jacob Kiss, of the Office of the Assistant Chief Counsel (Income Tax and Accounting). For further information regarding this notice contact Ms. Kiss on (202) 622-4920 (not a toll-free number).

26 CFR 601.201: Rulings and determination letters. (Also Part I, sections 561, 562, 852; 1.561–1, 1.562–2, 1.852–1, 1.852–3)

Rev. Proc. 99–40