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SERVICE RELEASES APPLICABLE FEDERAL RATES FOR DECEMBER.

NOV. 21, 1989

Rev. Rul. 89-127; 1989-2 C.B. 215

DATED NOV. 21, 1989
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Citations: Rev. Rul. 89-127; 1989-2 C.B. 215

Rev. Rul. 89-127

This revenue ruling provides various prescribed rates for federal income tax purposes for December 1989 (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 8 contains the annual rate for purposes of section 846 and section 807.

                                Table 1

 

 

           Applicable Federal Rates (AFR) for December 1989

 

 

                        Period for Compounding

 

                        ______________________

 

 

 Short-Term          Annual    Semiannual     Quarterly     Monthly

 

 __________          ______    __________     _________     _______

 

 

      AFR            8.02%       7.87%          7.79%        7.74%

 

 110% AFR            8.85%       8.66%          8.57%        8.51%

 

 120% AFR            9.66%       9.44%          9.33%        9.26%

 

 

 Mid-Term

 

 ________

 

 

      AFR            8.06%       7.90%          7.82%        7.77%

 

 110% AFR            8.88%       8.69%          8.60%        8.54%

 

 120% AFR            9.70%       9.48%          9.37%        9.30%

 

 150% AFR           12.20%      11.85%         11.68%       11.57%

 

 175% AFR           14.31%      13.83%         13.60%       13.45%

 

 

 Long-Term

 

 _________

 

 

      AFR            8.09%       7.93%          7.85%        7.80%

 

 110% AFR            8.91%       8.72%          8.63%        8.57%

 

 120% AFR            9.75%       9.52%          9.41%        9.34%

 

 

                                Table 2

 

 

                    Adjusted AFR for December 1989

 

 

                        Period for Compounding

 

                        ______________________

 

 

                  Annual    Semiannual     Quarterly      Monthly

 

                  ______    __________     _________      _______

 

 

 Short-term

 

 adjusted AFR     5.90%       5.82%          5.78%         5.75%

 

 

 Mid-term

 

 adjusted AFR     6.43%       6.33%          6.28%         6.25%

 

 

 Long-term

 

 adjusted AFR     7.01%       6.89%          6.83%         6.79%

 

 

                                Table 3

 

 

               Rates Under Section 382 for December 1989

 

 

 Adjusted federal long-term rate for the current month         7.01%

 

 

 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).                                            7.03%

 

 

                                Table 4

 

 

            Appropriate Percentages Under Section 42(b)(2)

 

                           for December 1989

 

 

 Appropriate percentage for the 70% present

 

 value low-income housing credit                               8.91%

 

 

 Appropriate percentage for the 30% present

 

 value low-income housing credit                               3.82%

 

 

                                Table 5

 

 

               Rate under section 7520 for December 1989

 

 

 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             9.8%

 

 

                                Table 6

 

 

                    Rate Under Sections 846 and 807

 

 

 Applicable Rate of Interest for 1990 for

 

 purposes of section 846 and 807                               8.37%
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