Rev. Rul. 98-6, 1998-4 I.R.B. 4.

INTERNAL REVENUE SERVICE
Revenue Ruling

LIFO; PRICE INDEXES; DEPARTMENT STORES

Published: January 26, 1998

Section 472. - Last-in, First-out Inventories, 26 CFR 1.472-1: Last-in, first- out inventories.
LIFO; price indexes; department stores. The November 1997 Bureau of Labor Statistics price indexes are accepted for use by department stores employing the retail inventory and last-in, first-out inventory methods for valuing inventories for tax years ended on, or with reference to, November 30, 1997.

The following Department Store Inventory Price Indexes for November 1997 were issued by the Bureau of Labor Statistics on December 16, 1997. The indexes are accepted by the Internal Revenue Service, under § 1.472-1(k) of the Income Tax Regulations and Rev. Proc. 86-46, 1986-2 C.B. 739, for appropriate application to inventories of department stores employing the retail inventory and last-in, first-out inventory methods for tax years ended on, or with reference to, November 30, 1997.

The Department Store Inventory Price Indexes are prepared on a national basis and include (a) 23 major groups of departments, (b) three special combinations of the major groups--soft goods, durable goods, and miscellaneous goods, and (c) a store total, which covers all departments, including some not listed separately, except for the following: candy, foods, liquor, tobacco, and contract departments.

BUREAU OF LABOR STATISTICS, DEPARTMENT STORE INVENTORY PRICE INDEXES BY DEPARTMENT GROUPS
(January 1941 = 100, unless otherwise noted)

Groups November 1996/November 1997/Percent Change from Nov. 1996 to Nov. 1997 [Fn1]
1. Piece Goods 55.9 524.6 -5.6
2. Domestics and Draperies 634.7 628.2 -1.0
3. Women's and Children's Shoes 656.1 661.7 0.9
4. Men's Shoes 903.7 906.9 0.4
5. Infants' Wear 614.8 618.2 0.6
6. Women's Underwear 535.4 552.9 3.3
7. Women's Hosiery 287.4 298.8 4.0
8. Women's and Girls' Accessories 562.5 543.7 -3.3
9. Women's Outerwear and Girls' Wear 415.9 428.4 3.0
10. Men's Clothing 633.0 621.2 -1.9
11. Men's Furnishings 591.5 604.0 2.1
12. Boys' Clothing and Furnishings 495.1 513.1 3.6
13. Jewelry 1020.6 978.9 -4.1
14. Notions 740.7 807.7 9.0
15. Toilet Articles and Drugs 903.4 917.8 1.6
16. Furniture and Bedding 667.8 665.8 -0.3
17. Floor Coverings 585.6 580.1 -0.9
18. Housewares 804.5 811.7 0.9
19. Major Appliances 244.2 241.0 -1.3
20. Radio and Television 78.1 74.2 -5.0
21. Recreation and Education [fn2] 111.3 108.3 -2.7
22. Home Improvements [fn2] 130.6 133.2 2.0
23. Auto Accessories [fn2] 107.1 107.9 0.7
Groups 1 - 15: Soft Goods 602.1 606.5 0.7
Groups 16 - 20: Durable Goods 466.5 462.6 -0.8
Groups 21 - 23: Misc. Goods [fn2] 113.0 111.4 -1.4
Store Total [fn3] 555.1 555.9 0.1

FN1 Absence of a minus sign before percentage change in this column signifies price increase.
FN2 Indexes on a January 1986=100 base.
FN3 The store total index covers all departments, including some not listed separately, except for the following: candy, foods, liquor, tobacco, and contract departments.

DRAFTING INFORMATION

The principal author of this revenue ruling is Stan Michaels of the Office of Assistant Chief Counsel (Income Tax and Accounting). For further information regarding this revenue ruling, contact Mr. Michaels on (202) 622-4970 (not a toll-free call).

Rev. Rul. 98-6, 1998-4 I.R.B. 4.