Sentence is: The money that is collected will go to the new school.
If I want to write that sentence using Reductive relative clause, Is it correct to write The money being collected or just collected? I think that's wrong just collected but not sure why.
Being collected or collected (Reductive Relative Clauses)
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Re: Being collected or collected (Reductive Relative Clauses)
"the money collected" is fine for your intended meaning.