Internal Revenue Bulletin:  2005-17 

April 25, 2005 

Rev. Rul. 2005-26


Table of Contents

LIFO; price indexes; department stores. The February 2005 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, February 28, 2005.

The following Department Store Inventory Price Indexes for February 2005 were issued by the Bureau of Labor Statistics. 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, February 28, 2005.

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)
Groups Feb. 2004 Feb. 2005 Percent Change from Feb. 2004 to Feb. 20051
1. Piece Goods 469.3 479.3 2.1
2. Domestics and Draperies 536.5 533.5 -0.6
3. Women’s and Children’s Shoes 609.9 663.6 8.8
4. Men’s Shoes 850.4 852.2 0.2
5. Infants’ Wear 583.8 575.5 -1.4
6. Women’s Underwear 506.7 527.1 4.0
7. Women’s Hosiery 354.3 349.2 -1.4
8. Women’s and Girls’ Accessories 556.6 592.0 6.4
9. Women’s Outerwear and Girls’ Wear 341.9 346.8 1.4
10. Men’s Clothing 534.0 550.9 3.2
11. Men’s Furnishings 572.3 574.2 0.3
12. Boys’ Clothing and Furnishings 436.6 423.5 -3.0
13. Jewelry 895.7 878.8 -1.9
14. Notions 793.9 780.0 -1.8
15. Toilet Articles and Drugs 984.6 998.7 1.4
16. Furniture and Bedding 624.2 601.8 -3.6
17. Floor Coverings 592.6 602.4 1.7
18. Housewares 715.2 713.8 -0.2
19. Major Appliances 206.8 203.7 -1.5
20. Radio and Television 43.3 39.7 -8.3
21. Recreation and Education2 81.6 79.7 -2.3
22. Home Improvements2 128.9 136.1 5.6
23. Automotive Accessories2 112.1 113.9 1.6
         
Groups 1-15: Soft Goods 549.5 556.7 1.3
Groups 16-20: Durable Goods 388.6 381.0 -2.0
Groups 21-23: Misc. Goods2 93.9 93.8 -0.1
       
  Store Total3 491.9 494.3 0.5
         
1Absence of a minus sign before the percentage change in this column signifies a price increase.
2Indexes on a January 1986 = 100 base.
3The 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 Michael Burkom of the Office of Associate Chief Counsel (Income Tax and Accounting). For further information regarding this revenue ruling, contact Mr. Burkom at (202) 622-7924 (not a toll-free call).


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