Internal Revenue Service
Revenue Ruling

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Rev. Rul. 2000-25, 2000-20 IRB 1006, IRC Sec(s). 472

Inventories.

Headnote:

The March 2000 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, March 31, 2000.

Full Text:

The following Department Store Inventory Price Indexes for March 2000 were issued by the Bureau of Labor Statistics. The indexes are accepted by the Internal Revenue Service, under

Section 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, March 31, 2000.

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, food, liquor, tobacco, and contract departments.

            BUREAU OF LABOR STATISTICS, DEPARTMENT STORE
            INVENTORY PRICE INDEXES BY DEPARTMENT GROUPS
            (January 1941 = 100, unless otherwise noted)
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                                                       Percent Change
                                                       from Mar. 1999
                                         Mar.    Mar.   to Mar. 2000
               Groups                    1999    2000       [fn1]
---------------------------------------------------------------------
1.  Piece Goods                         555.8   511.5       -8.0
2.  Domestics and Draperies             619.9   614.4       -0.9
3.  Women's and Children's Shoes        651.0   638.9       -1.9
4.  Men's Shoes                         887.6   902.4        1.7
5.  Infants' Wear                       617.2   649.8        5.3
6.  Women's Underwear                   577.4   582.7        0.9
7.  Women's Hosiery                     321.4   337.5        5.0
8.  Women's and Girls' Accessories      557.4   548.1       -1.7
9.  Women's Outerwear and Girls' Wear   408.4   409.5        0.3
10. Men's Clothing                      623.1   626.2        0.5
11. Men's Furnishings                   611.1   623.2        2.0
12. Boys' Clothing and Furnishings      488.6   498.1        1.9
13. Jewelry                             977.8   965.3       -1.3
14. Notions                             785.7   746.6       -5.0
15. Toilet Articles and Drugs           957.3   968.0        1.1
16. Furniture and Bedding               690.9   693.1        0.3
17. Floor Coverings                     602.4   606.8        0.7
18. Housewares                          803.5   787.4       -2.0
19. Major Appliances                    233.9   235.7        0.8
20. Radio and Television                 67.9    61.0      -10.2
21. Recreation and Education [fn2]       99.9    94.8       -5.1
22. Home Improvements [fn2]             128.5   128.0       -0.4
23. Auto Accessories [fn2]              107.4   107.6        0.2
Groups 1 - 15: Soft Goods               603.6   606.3        0.4
Groups 16 - 20: Durable Goods           454.6   444.3       -2.3
Groups 21 - 23: Misc. Goods [fn2]       105.1   101.7       -3.2
Store Total [fn3]                       548.5   545.5       -0.5
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     [fn1] Absence of a minus sign before the percentage change in this
column signifies a 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, food, liquor,
tobacco, and contract departments.

Drafting Information

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