SERVICE LISTS INTEREST RATES FOR COMPUTING SPECIAL USE VALUATIONS OF FARM PROPERTY.

Rev. Rul. 90-49

This revenue ruling contains a list of the average annual effective interest rates on new loans under the Farm Credit Bank system. (Prior to 1988, the Farm Credit Banks were known as Federal Land Banks. As a result of the Agriculture Credit Act of 1987, Pub. L. No. 100-233, each Federal Land Bank merged into a newly created Farm Credit Bank.) This revenue ruling also contains a list of the states within each Farm Credit Bank District.

Under section 2032A(e)(7)(A)(ii) of the Internal Revenue Code, rates on new Farm Credit Bank loans are used in computing the special use value of real property as a farm for which an election is made under section 2032A. The rates in this revenue ruling may be used by estates that value farmland under section 2032A as of a date in 1990.

Average annual effective interest rates, calculated in accordance with section 2032A(e)(7)(A) of the Code and section 20.2032A-4(e) of the Estate Tax Regulations, to be used under section 2032A(e)(7)(A)(ii), are set forth in the accompanying Table of Interest Rates (Table I). The states within each Farm Credit Bank District are set forth in the accompanying Table of Farm Credit Bank Districts (Table II).

Rev. Rul. 81-170, 1981-1 C.B. 454, contains an illustrative computation of an average annual effective interest rate. The rates applicable for valuation in 1989 are in Rev. Rul. 89-58, 1989-1 C.B. 275. For rate information for years prior to 1989, see Rev. Rul. 88- 59, 1988-2 C.B. 332, and other revenue rulings that are cited therein.

DRAFTING INFORMATION

The principal author of this revenue ruling is Lane Damazo of the Office of the Assistant Chief Counsel (Passthroughs and Special Industries). For further information regarding this revenue ruling contact Lane Damazo on (202) 535-6766 (not a toll-free call).

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