Rev. Rul. 88-83

1988-2 C.B. 321, 1988-40 I.R.B. 1.

                       Internal Revenue Service

                                 Revenue Ruling

     FEDERAL RATES; ADJUSTED FEDERAL RATES; ADJUSTED FEDERAL LONG-TERM RATE,

                          AND THE LONG-TERM EXEMPT RATE

                         Published: September 20, 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.)

  Federal rates; adjusted federal rates; adjusted federal long-term rate, and the long-term exempt rate. For purposes of sections 1274, 1288, 382, and other sections of the Code, tables set forth the rates for October 1988.

  This revenue ruling provides various prescribed rates for federal income tax purposes for October 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. 88-83 TABLE 1

    Applicable Federal Rates (AFR) for October 1988

                       Period for Compounding

              Annual  Semiannual    Quarterly   Monthly

  Short-Term

         AFR   8.56%        8.38%        8.29%    8.24%

    110% AFR   9.43%        9.22%        9.12%    9.05%

    120% AFR  10.31%       10.06%        9.94%    9.86%

    Mid-Term

         AFR   9.19%        8.99%        8.89%    8.83%

    110% AFR  10.13%        9.89%        9.77%    9.69%

    120% AFR  11.08%       10.79%       10.65%   10.56%

   Long-Term

         AFR   9.45%        9.24%        9.14%    9.07%

    110% AFR  10.42%       10.16%       10.03%    9.95%

    120% AFR  11.40%       11.09%       10.94%   10.84%

                REV. RUL. 88-83 TABLE 2

             Adjusted AFR for October 1988

                       Period for Compounding

              Annual  Semiannual    Quarterly   Monthly

  Short-term

adjusted AFR   5.89%        5.81%        5.77%    5.74%

    Mid-term

adjusted AFR   6.44%        6.34%        6.29%    6.26%

   Long-term

adjusted AFR   7.41%        7.28%        7.21%    7.17%

                   REV. RUL. 88-83 TABLE 3

          Rates Under Section 382 for October 1988

Adjusted federal long-term rate for the current month   7.41%

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

their prior two months).                                7.41%

                   REV. RUL. 88-83 TABLE 4

       Appropriate Percentages Under Section 42(b)(2)

                      for October 1988

Appropriate percentage for the 70% present value low-

income housing credit                                   9.22%

Appropriate percentage for the 30% present value

low-income housing credit                               3.95%

Rev. Rul. 88-83, 1988-2 C.B. 321, 1988-40 I.R.B. 1.