But the normally polite bond counsel community, the lawyers who review municipal bonds to insure that they qualify as tax-exempt investments, is deeply divided on the question.

Salomon's fund business for such clients now involves only municipal bonds and tax-exempt investments.

You may want to switch your tax-exempt investments.

Yields may also be down because of continuing demand by investors for tax-exempt investments as a hedge against future tax increases.

And if a board wanted to avoid tax on the interest income earned on its reserve, it could put the money into tax-exempt investments, as many buildings are now doing.

The most popular tax-exempt investments are municipal bonds, although certain municipal bonds are subject to the alternative minimum tax.

A new Federal health-care plan for the elderly contains a loophole that encourages tax-exempt investments and could cost the Treasury significant revenue losses, a Government investigator said last week.

Congress ordered that the premiums be based on an individual's income tax liability, which excludes income from tax-exempt investments like municipal bonds.

The effect of tax reform on the value of a tax-exempt investment has given buyers of muni bonds an additional reason for careful scrutiny.

ANOTHER option would be to buy tax-exempt investments for them.