Rev. Rul. 88-61

1988-2 C.B. 319, 1988-30 I.R.B. 1.

                       Internal Revenue Service

                                 Revenue Ruling

                            Published: July 21, 1988

Section 1274. -- DETERMINATION OF ISSUE PRICE IN THE CASE OF CERTAIN DEBT INSTRUMENTS ISSUED FOR PROPERTY

(Also Sections 42, 280G, 382, 467, 468, 483, 1288, 7872.)

  This revenue ruling provides various prescribed rates for federal income tax purposes for August 1988 (the current month). Table 1 contains the short-term, mid-term, and long-term applicable federal rates (AFR) for the current month for purposes of section 1274(d) of the Internal Revenue Code. Table 2 contains the short- term, mid-term, and long-term adjusted applicable federal rates (adjusted AFR) for the current month for purposes of section 1288(b). Table 3 sets forth the adjusted federal long-term rate and the long- term tax-exempt rate described in section 382(f). Finally, Table 4 contains the appropriate percentages for determining the low-income housing credit described in section 42(b)(2) for buildings placed in service during the current month.

                      REV. RUL. 88-61 TABLE 1.

           Applicable Federal Rates (AFR) for August 1988
                         Period for Compounding
                         ______________________
               Annual    Semiannual     Quarterly      Monthly
               ______    __________     _________      _______
Short-Term
__________
     AFR       7.96%       7.81%           7.74%         7.69%
110% AFR       8.77%       8.59%           8.50%         8.49%
120% AFR       9.59%       9.37%           9.26%         9.19%
Mid-Term
________
     AFR       8.85%       8.66%           8.57%         8.51%
110% AFR       9.76%       9.53%           9.92%         9.35%
120% AFR      10.66%      10.39%          10.26%        10.17%
Long-Term
_________
     AFR       9.17%       8.97%           8.87%         8.81%
110% AFR      10.11%       9.87%           9.75%         9.67%
120% AFR      11.05%      10.76%          10.62%        10.53%
                       REV. RUL. 88-61 TABLE 2
                    Adjusted AFR for August 1988
                              Period for Compounding
                              ______________________
               Annual    Semiannual     Quarterly      Monthly
               ______    __________     _________      ________
Short-term
adjusted AFR   5.27%       5.20%          5.17%          5.14%
Mid-term
adjusted AFR   6.40%       6.30%          6.25%          6.22%
Long-term
adjusted AFR   7.38%       7.25%          7.19%          7.19%
                       REV. RUL. 88-61 TABLE 3
               Rates Under Section 382 for August 1988
Adjusted federal long-term rate for the current month      7.38%
Long-term tax-exempt rate for ownership changes
during the current month (the highest of the adjusted
federal long-term rates for the current month and the
prior two months).                                         7.44%
                       REV. RUL. 88-61 TABLE 4
           Appropriate Percentages Under Section 92(b)(2)
                           for August 1988
Appropriate percentage for the 70% present
value low-income housing credit                            9.14%
Appropriate percentage for the 30% present
value low-income housing credit                            3.92%
Rev. Rul. 88-61, 1988-2 C.B. 319, 1988-30 I.R.B. 1.