Revenue Ruling 2005-73 - November 28, 2005

LIFO; price indexes; department stores. The September 2005 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, September 30, 2005.

The following Department Store Inventory Price Indexes for September 2005 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, September 30, 2005.

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		Sep. 2004	Sep. 2005	Percent Change from Sep. 2004 to Sep. 2005¹
1.	Piece Goods	488.9	497.3	1.7
2.	Domestics and Draperies	526.6	514.7	-2.3
3.	Women’s and Children’s Shoes	657.4	700.4	6.5
4.	Men’s Shoes	842.8	890.9	5.7
5.	Infants’ Wear	582.8	569.6	-2.3
6.	Women’s Underwear	509.6	541.1	6.2
7.	Women’s Hosiery	336.6	338.6	0.6
8.	Women’s and Girls’ Accessories	576.2	572.2	-0.7
9.	Women’s Outerwear and Girls’ Wear	371.0	364.0	-1.9
10.	Men’s Clothing	531.2	532.9	0.3
11.	Men’s Furnishings	567.1	561.0	-1.1
12.	Boys’ Clothing and Furnishings	425.7	393.1	-7.7
13.	Jewelry	886.2	882.6	-0.4
14.	Notions	797.8	807.4	1.2
15.	Toilet Articles and Drugs	993.2	996.4	0.3
16.	Furniture and Bedding	608.0	596.0	-2.0
17.	Floor Coverings	584.0	606.7	3.9
18.	Housewares	711.7	703.4	-1.2
19.	Major Appliances	197.4	204.4	3.5
20.	Radio and Television	41.1	38.6	-6.1
21.	Recreation and Education²	79.9	77.4	-3.1
22.	Home Improvements²	128.9	136.4	5.8
23.	Automotive Accessories²	113.0	116.3	2.9

Groups 1-15: Soft Goods		559.8	559.6	0.0
Groups 16-20: Durable Goods		379.8	377.0	-0.7
Groups 21-23: Misc. Goods²		93.0	92.8	-0.2

	Store Total³	495.4	494.5	-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, including some not listed separately, except for the following: candy, food, liquor, tobacco, and contract departments.

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The principal author of this revenue ruling is Michael Burkom of the Office of Associate Chief Counsel (Income Tax and Accounting). For further information regarding this revenue ruling, contact Mr. Burkom at (202) 622-7924 (not a toll-free call).

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LIFO; Price Indexes; Department Stores

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