Rev. Rul. 85-92

1985-2 C.B. 198, 1985-27 I.R.B. 6.

SPECIAL USE VALUE; FARMS; INTEREST RATES

Published: July 8, 1985

SECTION 2032A.-VALUATION OF CERTAIN FARM, ETC., REAL PROPERTY, 26 CFR 20.2032A: Method of valuing farm real property

  Special use value; farms; interest rates. The interest rates to be used in computing the special use value of farm real property for which an election is made under section 2032A of the Code are listed. The rates may be used by estates that value farmland under section 2032A as of a date in 1985.

  This revenue ruling contains a list of the average annual effective interest rates on new Federal Land Bank loans. Under section 2032A(e)(7)(A)(ii) of the Internal Revenue Code, rates on new Federal Land Bank loans are used in computing the special use value of real property used as a farm for which an election is made under section 2032A. This revenue ruling also contains a list of the states within each land bank district. The rates in this revenue ruling may be used by estates that value farmland under section 2032A as of a date in 1985.

  Average annual effective interest rates, calculated in accordance with section 2032A(e)(7)(A) of the Code and section 20.2032A-4(e) of the Estate Tax Regulations, to be used under section 2032A(e)(7)(A)(ii) are as follows:

Federal Land Bank District        Year of valuation
in which property is located            1985
Baltimore ............................. 12.60
Columbia .............................. 11.69
Texas (Formerly Houston) .............. 11.41
Louisville ............................ 12.27
Jackson (Formerly New Orleans) ........ 11.94
Omaha ................................. 12.45
Sacramento ............................ 11.92
St. Louis ............................. 12.44
St. Paul .............................. 11.98
Spokane ............................... 12.12
Springfield ........................... 11.73
Wichita ............................... 12.41

Federal Land Bank District:
District                                           States
Baltimore ................... Delaware, District of Columbia, Maryland,
                              Pennsylvania, Virginia, West Virginia
Columbia .................... Florida, Georgia, North Carolina, South
                              Carolina
Texas ....................... Texas
Louisville .................. Indiana, Kentucky, Ohio, Tennessee
Jackson ..................... Alabama, Louisiana, Mississippi
Omaha ....................... Iowa, Nebraska, South Dakota, Wyoming
Sacramento .................. Arizona, California, Hawaii, Nevada, Utah
St. Louis ................... Arkansas, Illinois, Missouri
St. Paul .................... Michigan, Minnesota, North Dakota,
                              Wisconsin
Spokane ..................... Alaska, Idaho, Montana, Oregon,
                              Washington
Springfield ................. Connecticut, Maine, Massachusetts, New Hampshire,
New Jersey, New York, Rhode
  Island, Vermont
Wichita ..................... Colorado, Kansas, New Mexico, Oklahoma
  Rev. Rul. 81-170, 1981-1 C.B. 454, which sets forth rates for several prior years, contains an illustrative computation of an average annual effective interest rate. The rates applicable in the case of valuations for 1982 are listed in Rev. Rul. 82-104, 1982-1 C.B. 129. The rates applicable in the case of valuations for 1983 are listed in Rev. Rul. 83-71, 1983-1 C.B. 227, and for valuations in 1984 in Rev. Rul. 84-119, 1984-32 I.R.B. 15.

Rev. Rul. 85-92, 1985-2 C.B. 198, 1985-27 I.R.B. 6.