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IRS Publishes T-Bill Rate Used for Tax on DISC Income

DEC. 16, 2019

Rev. Rul. 2019-27; 2019-51 IRB 1378

DATED DEC. 16, 2019
DOCUMENT ATTRIBUTES
  • Institutional Authors
    Internal Revenue Service
  • Code Sections
  • Subject Areas/Tax Topics
  • Jurisdictions
  • Tax Analysts Document Number
    2019-47252
  • Tax Analysts Electronic Citation
    2019 TNTG 4-40
    2019 TNTF 241-32
    2019 TPR 50-21
Citations: Rev. Rul. 2019-27; 2019-51 IRB 1378

Part I

Section 995. — Taxation of DISC Income to Shareholders

2019 Base Period T-Bill Rate. The “base period T-bill rate” for the period ending September 30, 2019, is published as required by section 995(f) of the Internal Revenue Code.

Section 995(f)(1) of the Internal Revenue Code provides that a shareholder of a domestic international sales corporation (“DISC”) shall pay interest each taxable year in an amount equal to the product of the “shareholder's DISC-related deferred tax liability” for the year (as defined in section 995(f)(2)) and the “base period T-bill rate.” Under section 995(f)(4), the base period T-bill rate is the annual rate of interest determined by the Secretary to be equivalent to the average of the 1-year constant maturity Treasury yields, as published by the Board of Governors of the Federal Reserve System, for the 1-year period ending on September 30 of the calendar year ending with (or of the most recent calendar year ending before) the close of the taxable year of the share-holder.

The base period T-bill rate for the period ending September 30, 2019, is 2.32 percent.

Pursuant to section 6622 of the Internal Revenue Code, interest must be compounded daily. The table below provides factors for compounding the 2019 base period T-bill rate daily for any number of days in the shareholder's taxable year (including for a 52-53 week accounting period). To compute the amount of the interest charge for the shareholder's taxable year, multiply the amount of the shareholder's DISC-related deferred tax liability for that year by the base period T-bill rate factor corresponding to the number of days in the shareholder's taxable year for which the interest charge is being computed. Generally, one would use the factor for 365 days. One would use a different factor only if the shareholder's taxable year for which the interest charge is being determined is a short taxable year, if the shareholder uses a 52-53 week taxable year, or if the shareholder's taxable year is a leap year.

For the base period T-bill rates for periods ending in prior years, see Rev. Rul. 2018-31, 2018-50 I.R.B. 848; Rev. Rul. 2017-23, 2017-49 I.R.B. 546; Rev. Rul. 2017-01, 2017-03 I.R.B. 377; Rev. Rul. 2015-26, 2015-49 I.R.B. 696; Rev. Rul. 2014-33, 2014-52 I.R.B. 957; Rev. Rul. 2013-24, 2013-49 I.R.B. 594; Rev. Rul. 2012-22, 2012-48 I.R.B. 565; and Rev. Rul. 2011-30, 2011-49 I.R.B. 826.

DRAFTING INFORMATION

The principal author of this revenue ruling is Kristina L. Novak of the Office of Associate Chief Counsel (International). For further information regarding the revenue ruling, contact Ms. Novak at (202) 317-3800 (not a toll-free number).

ANNUAL RATE, COMPOUNDED DAILY 2.32 PERCENT

DAYS

FACTOR

1

0.000063562

2

0.000127127

3

0.000190697

4

0.000254271

5

0.000317849

6

0.000381430

7

0.000445016

8

0.000508606

9

0.000572200

10

0.000635798

11

0.000699400

12

0.000763006

13

0.000826617

14

0.000890231

15

0.000953849

16

0.001017471

17

0.001081098

18

0.001144728

19

0.001208362

20

0.001272001

21

0.001335643

22

0.001399290

23

0.001462940

24

0.001526595

25

0.001590254

26

0.001653916

27

0.001717583

28

0.001781254

29

0.001844929

30

0.001908608

31

0.001972291

32

0.002035978

33

0.002099669

34

0.002163364

35

0.002227063

36

0.002290766

37

0.002354474

38

0.002418185

39

0.002481900

40

0.002545620

41

0.002609343

42

0.002673071

43

0.002736802

44

0.002800538

45

0.002864277

46

0.002928021

47

0.002991769

48

0.003055521

49

0.003119276

50

0.003183036

51

0.003246800

52

0.003310568

53

0.003374340

54

0.003438116

55

0.003501897

56

0.003565681

57

0.003629469

58

0.003693262

59

0.003757058

60

0.003820858

61

0.003884663

62

0.003948471

63

0.004012284

64

0.004076101

65

0.004139921

66

0.004203746

67

0.004267575

68

0.004331408

69

0.004395245

70

0.004459086

71

0.004522931

72

0.004586780

73

0.004650633

74

0.004714491

75

0.004778352

76

0.004842217

77

0.004906087

78

0.004969960

79

0.005033838

80

0.005097719

81

0.005161605

82

0.005225495

83

0.005289388

84

0.005353286

85

0.005417188

86

0.005481094

87

0.005545004

88

0.005608918

89

0.005672836

90

0.005736759

91

0.005800685

92

0.005864615

93

0.005928550

94

0.005992488

95

0.006056431

96

0.006120377

97

0.006184328

98

0.006248283

99

0.006312242

100

0.006376204

101

0.006440171

102

0.006504142

103

0.006568117

104

0.006632096

105

0.006696080

106

0.006760067

107

0.006824058

108

0.006888054

109

0.006952053

110

0.007016057

111

0.007080064

112

0.007144076

113

0.007208092

114

0.007272111

115

0.007336135

116

0.007400163

117

0.007464195

118

0.007528231

119

0.007592271

120

0.007656316

121

0.007720364

122

0.007784416

123

0.007848473

124

0.007912533

125

0.007976598

126

0.008040667

127

0.008104739

128

0.008168816

129

0.008232897

130

0.008296982

131

0.008361071

132

0.008425164

133

0.008489261

134

0.008553362

135

0.008617468

136

0.008681577

137

0.008745690

138

0.008809808

139

0.008873930

140

0.008938055

141

0.009002185

142

0.009066319

143

0.009130457

144

0.009194599

145

0.009258745

146

0.009322895

147

0.009387049

148

0.009451208

149

0.009515370

150

0.009579536

151

0.009643707

152

0.009707882

153

0.009772060

154

0.009836243

155

0.009900430

156

0.009964621

157

0.010028816

158

0.010093015

159

0.010157218

160

0.010221425

161

0.010285637

162

0.010349852

163

0.010414072

164

0.010478295

165

0.010542523

166

0.010606755

167

0.010670990

168

0.010735230

169

0.010799474

170

0.010863722

171

0.010927975

172

0.010992231

173

0.011056491

174

0.011120756

175

0.011185024

176

0.011249297

177

0.011313573

178

0.011377854

179

0.011442139

180

0.011506428

181

0.011570721

182

0.011635018

183

0.011699319

184

0.011763624

185

0.011827934

186

0.011892247

187

0.011956565

188

0.012020886

189

0.012085212

190

0.012149542

191

0.012213876

192

0.012278214

193

0.012342556

194

0.012406902

195

0.012471252

196

0.012535606

197

0.012599965

198

0.012664327

199

0.012728694

200

0.012793065

201

0.012857440

202

0.012921818

203

0.012986201

204

0.013050588

205

0.013114980

206

0.013179375

207

0.013243774

208

0.013308178

209

0.013372585

210

0.013436997

211

0.013501413

212

0.013565832

213

0.013630256

214

0.013694684

215

0.013759116

216

0.013823553

217

0.013887993

218

0.013952437

219

0.014016886

220

0.014081338

221

0.014145795

222

0.014210256

223

0.014274721

224

0.014339190

225

0.014403663

226

0.014468140

227

0.014532621

228

0.014597106

229

0.014661596

230

0.014726089

231

0.014790587

232

0.014855089

233

0.014919595

234

0.014984105

235

0.015048619

236

0.015113137

237

0.015177659

238

0.015242186

239

0.015306716

240

0.015371251

241

0.015435789

242

0.015500332

243

0.015564879

244

0.015629430

245

0.015693985

246

0.015758544

247

0.015823107

248

0.015887675

249

0.015952246

250

0.016016822

251

0.016081402

252

0.016145985

253

0.016210573

254

0.016275165

255

0.016339761

256

0.016404362

257

0.016468966

258

0.016533574

259

0.016598187

260

0.016662804

261

0.016727424

262

0.016792049

263

0.016856678

264

0.016921311

265

0.016985948

266

0.017050590

267

0.017115235

268

0.017179885

269

0.017244538

270

0.017309196

271

0.017373858

272

0.017438524

273

0.017503194

274

0.017567868

275

0.017632546

276

0.017697229

277

0.017761915

278

0.017826606

279

0.017891301

280

0.017955999

281

0.018020702

282

0.018085410

283

0.018150121

284

0.018214836

285

0.018279555

286

0.018344279

287

0.018409007

288

0.018473738

289

0.018538474

290

0.018603214

291

0.018667958

292

0.018732706

293

0.018797459

294

0.018862215

295

0.018926976

296

0.018991740

297

0.019056509

298

0.019121282

299

0.019186059

300

0.019250840

301

0.019315626

302

0.019380415

303

0.019445208

304

0.019510006

305

0.019574808

306

0.019639614

307

0.019704424

308

0.019769238

309

0.019834056

310

0.019898878

311

0.019963705

312

0.020028535

313

0.020093370

314

0.020158209

315

0.020223052

316

0.020287899

317

0.020352750

318

0.020417605

319

0.020482465

320

0.020547328

321

0.020612196

322

0.020677068

323

0.020741944

324

0.020806824

325

0.020871708

326

0.020936596

327

0.021001488

328

0.021066385

329

0.021131286

330

0.021196190

331

0.021261099

332

0.021326012

333

0.021390930

334

0.021455851

335

0.021520776

336

0.021585706

337

0.021650639

338

0.021715577

339

0.021780519

340

0.021845465

341

0.021910415

342

0.021975370

343

0.022040328

344

0.022105291

345

0.022170257

346

0.022235228

347

0.022300203

348

0.022365182

349

0.022430165

350

0.022495153

351

0.022560144

352

0.022625140

353

0.022690140

354

0.022755143

355

0.022820151

356

0.022885164

357

0.022950180

358

0.023015200

359

0.023080225

360

0.023145253

361

0.023210286

362

0.023275323

363

0.023340364

364

0.023405409

365

0.023470459

366

0.023535512

367

0.023600570

368

0.023665632

369

0.023730697

370

0.023795767

371

0.023860842
DOCUMENT ATTRIBUTES
  • Institutional Authors
    Internal Revenue Service
  • Code Sections
  • Subject Areas/Tax Topics
  • Jurisdictions
  • Tax Analysts Document Number
    2019-47252
  • Tax Analysts Electronic Citation
    2019 TNTG 4-40
    2019 TNTF 241-32
    2019 TPR 50-21
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