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Internal Revenue Bulletin:  2007-18 

April 30, 2007 

Rev. Rul. 2007-27

Table of Contents

LIFO; price indexes; department stores. The February 2007 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, 2007.

The following Department Store Inventory Price Indexes for February 2007 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, 2007.

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. 2006 Feb. 2007 Percent Change From Feb. 2006 to Feb. 20071
1. Piece Goods 437.4 427.9 -2.2
2. Domestics and Draperies 499.5 474.1 -5.1
3. Women’s and Children’s Shoes 678.8 655.3 -3.5
4. Men’s Shoes 869.8 867.5 -0.3
5. Infants’ Wear 563.8 566.3 0.4
6. Women’s Underwear 538.4 554.1 2.9
7. Women’s Hosiery 346.1 345.8 -0.1
8. Women’s and Girls’ Accessories 570.3 547.7 -4.0
9. Women’s Outerwear and Girls’ Wear 334.1 360.0 7.8
10. Men’s Clothing 519.4 520.1 0.1
11. Men’s Furnishings 556.4 566.4 1.8
12. Boys’ Clothing and Furnishings 400.2 381.2 -4.7
13. Jewelry 857.6 917.0 6.9
14. Notions 793.6 807.2 1.7
15. Toilet Articles and Drugs 1010.6 1001.8 -0.9
16. Furniture and Bedding 602.0 603.9 0.3
17. Floor Coverings 614.1 615.0 0.1
18. Housewares 698.0 692.9 -0.7
19. Major Appliances 204.3 211.0 3.3
20. Radio and Television 37.3 33.5 -10.2
21. Recreation and Education2 77.3 76.4 -1.2
22. Home Improvements2 139.2 141.6 1.7
23. Automotive Accessories2 117.4 122.7 4.5
         
Groups 1-15: Soft Goods 543.7 552.2 1.6
Groups 16-20: Durable Goods 375.1 372.4 -0.7
Groups 21-23: Misc. Goods2 93.3 94.1 0.9
       
  Store Total3 484.5 489.6 1.1
         
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 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) 622-4930 (not a toll-free call).

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