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IRS ANNOUNCES APPLICABLE FEDERAL RATES FOR DECEMBER.

NOV. 20, 1997

Rev. Rul. 97-50; 1997-2 C.B. 106

DATED NOV. 20, 1997
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Citations: Rev. Rul. 97-50; 1997-2 C.B. 106

Rev. Rul. 97-50

[1] This revenue ruling provides various prescribed rates for federal income tax purposes for December 1997 (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). 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. Table 5 contains the federal rate for determining the present value of an annuity, an interest for life or for a term of years, or a remainder or a reversionary interest for purposes of section 7520. Finally, Table 6 contains the 1998 interest rate for sections 846 and 807.

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                            REV. RUL. 97-50

 

                                TABLE 1

 

 

           Applicable Federal Rates (AFR) for December 1997

 

                        Period for Compounding

 

 

                     Annual     Semiannual   Quarterly   Monthly

 

                     ______     __________   _________   _______

 

 

    Short-Term

 

    __________

 

           AFR        5.68%        5.60%       5.56%       5.54%

 

      110% AFR        6.25%        6.16%       6.11%       6.08%

 

      120% AFR        6.83%        6.72%       6.66%       6.63%

 

      130% AFR        7.41%        7.28%       7.21%       7.17%

 

 

    Mid-Term

 

    ________

 

           AFR        6.02%        5.93%       5.89%       5.86%

 

      110% AFR        6.63%        6.52%       6.47%       6.43%

 

      120% AFR        7.25%        7.12%       7.06%       7.02%

 

      130% AFR        7.86%        7.71%       7.64%       7.59%

 

      150% AFR        9.10%        8.90%       8.80%       8.74%

 

      175% AFR       10.65%       10.38%      10.25%      10.16%

 

 

  Long-Term

 

  _________

 

           AFR       6.31%        6.21%       6.16%       6.13%

 

      110% AFR       6.95%        6.83%       6.77%       6.73%

 

      120% AFR       7.59%        7.45%       7.38%       7.34%

 

      130% AFR       8.23%        8.07%       7.99%       7.94%

 

 _____________________________________________________________________

 

 

                            REV. RUL. 97-50

 

                                TABLE 2

 

 

                    Adjusted AFR for December 1997

 

                        Period for Compounding

 

 

                  Annual   Semiannual    Quarterly    Monthly

 

                  ______   __________    _________    _______

 

 

   Short-term

 

   adjusted AFR    3.92%     3.88%        3.86%        3.85%

 

 

   Mid-term

 

   adjusted AFR    4.37%     4.32%        4.30%        4.28%

 

 

   Long-term

 

   adjusted AFR    5.23%     5.16%        5.13%        5.11%

 

 _____________________________________________________________________

 

 

                            REV. RUL. 97-50

 

                                TABLE 3

 

 

               Rates Under Section 382 for December 1997

 

 

 Adjusted federal long-term rate for the current month          5.23%

 

 

 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.)                                             5.27%

 

 _____________________________________________________________________

 

 

                            REV. RUL. 97-50

 

                                TABLE 4

 

 

            Appropriate Percentages Under Section 42(b)(2)

 

                           for December 1997

 

 

       Appropriate percentage for the 70% present

 

       value low-income housing credit                  8.45%

 

 

       Appropriate percentage for the 30% present

 

       value low-income housing credit                  3.62%

 

 _____________________________________________________________________

 

 

                            REV. RUL. 97-50

 

                                TABLE 5

 

 

               Rate Under Section 7520 for December 1997

 

 

      Applicable federal rate for determining the present

 

      value of an annuity, an interest for life or a term

 

      of years, or a remainder or reversionary interest       7.2%

 

 _____________________________________________________________________

 

 

                            REV. RUL. 97-50

 

                                TABLE 6

 

 

                    Rate under Sections 846 and 807

 

 

      Applicable rate of interest for 1998 for

 

      purposes of sections 846 and 807                       6.31%

 

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