Internal Revenue Bulletin:  2007-9 

February 26, 2007 

Rev. Rul. 2007-11


Table of Contents

LIFO; price indexes; department stores. The December 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, December 31, 2006.

The following Department Store Inventory Price Indexes for December 2006 were issued by the Bureau of Labor Statistics (BLS). 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, December 31, 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 Dec. 2005 Dec. 2006 Percent Change From Dec. 2005 to Dec. 20061
1. Piece Goods 467.2 448.2 -4.1
2. Domestics and Draperies 506.3 476.6 -5.9
3. Women’s and Children’s Shoes 659.5 667.5 1.2
4. Men’s Shoes 862.7 889.6 3.1
5. Infants’ Wear 568.5 561.2 -1.3
6. Women’s Underwear 547.0 547.6 0.1
7. Women’s Hosiery 337.9 345.8 2.3
8. Women’s and Girls’ Accessories 558.5 542.4 -2.9
9. Women’s Outerwear and Girls’ Wear 350.8 356.8 1.7
10. Men’s Clothing 527.4 519.6 -1.5
11. Men’s Furnishings 560.6 571.4 1.9
12. Boys’ Clothing and Furnishings 394.0 387.5 -1.6
13. Jewelry 842.7 872.7 3.6
14. Notions 801.0 822.8 2.7
15. Toilet Articles and Drugs 1000.7 1014.0 1.3
16. Furniture and Bedding 602.9 597.4 -0.9
17. Floor Coverings 614.5 622.1 1.2
18. Housewares 697.7 685.7 -1.7
19. Major Appliances 205.0 209.5 2.2
20. Radio and Television 37.7 34.0 -9.8
21. Recreation and Education2 77.4 76.1 -1.7
22. Home Improvements2 136.7 141.2 3.3
23. Automotive Accessories2 117.0 122.1 4.4
         
Groups 1-15: Soft Goods 548.0 551.3 0.6
Groups 16-20: Durable Goods 375.7 370.0 -1.5
Groups 21-23: Misc. Goods2 93.0 93.8 0.9
       
  Store Total3 487.2 488.2 0.2
         
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, with the following exceptions: candy, food, liquor, tobacco, as well as contract departments.

DRAFTING INFORMATION

The principal author of this revenue ruling is John Roman Faron of the Office of Associate Chief Counsel (Income Tax and Accounting). For further information regarding this revenue ruling, contact Mr. Faron at (202) 622-8142 (not a toll-free call).


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