Internal Revenue Bulletin:  2006-35 

August 28, 2006 

Rev. Rul. 2006-41


Table of Contents

LIFO; price indexes; department stores. The June 2006 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, June 30, 2006.

The following Department Store Inventory Price Indexes for June 2006 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, June 30, 2006.

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 June 2005 June 2006 Percent Change from June 2005 to June 20061
1. Piece Goods 504.8 456.6 -9.5
2. Domestics and Draperies 519.1 490.1 -5.6
3. Women’s and Children’s Shoes 650.4 686.5 5.6
4. Men’s Shoes 878.2 892.0 1.6
5. Infants’ Wear 559.9 556.3 -0.6
6. Women’s Underwear 541.4 549.9 1.6
7. Women’s Hosiery 340.0 349.4 2.8
8. Women’s and Girls’ Accessories 588.9 564.4 -4.2
9. Women’s Outerwear and Girls’ Wear 347.5 354.4 2.0
10. Men’s Clothing 536.9 523.2 -2.6
11. Men’s Furnishings 562.8 560.2 -0.5
12. Boys’ Clothing and Furnishings 413.6 388.3 -6.1
13. Jewelry 872.3 885.9 1.6
14. Notions 810.4 815.1 0.6
15. Toilet Articles and Drugs 997.0 996.4 -0.1
16. Furniture and Bedding 598.7 604.1 0.9
17. Floor Coverings 604.6 610.4 1.0
18. Housewares 711.9 695.7 -2.3
19. Major Appliances 204.3 203.1 -0.6
20. Radio and Television 39.0 36.1 -7.4
21. Recreation and Education2 78.5 76.8 -2.2
22. Home Improvements2 137.8 139.3 1.1
23. Automotive Accessories2 114.6 120.1 4.8
         
Groups 1-15: Soft Goods 552.0 552.2 0.0
Groups 16-20: Durable Goods 379.8 372.9 -1.8
Groups 21-23: Misc. Goods2 93.4 93.6 0.2
       
  Store Total3 490.8 489.4 -0.3
         
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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