• Home
• Federal Income Taxes
• State Tax Laws
• Estate Planning
• Publications
• Professional Research
  • Master Index
  • Case Law
  • Revenue Rulings
  • Private Letter Rulings
  • Regulations
  • Internal Revenue Code
  • Public Laws
  • Research Process
• Tax Workshops/Education
• Tax Policy
• Links

Revenue Ruling 2002-26, I.R.B. 2002-19, 906, (May 13, 2002)

Estate tax: Special use valuation: Farms: Interest rates

[Code Sec. 2032A ]

Estate tax: Special use valuation: Farms: Interest rates.--The IRS has issued a listing of the average annual effective interest rates charged on new loans under the Farm Credit Bank system. The rates are used in computing the value of farm real property for which a special use valuation election is made and may be used by estates that value farmland under Code Sec. 2032A as of a date in 2002.

This revenue ruling contains a list of the average annual effective interest rates on new loans under the Farm Credit Bank system. This revenue ruling also contains a list of the states within each Farm Credit Bank District.

Under §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 used as a farm for which an election is made under §2032A . The rates in this revenue ruling may be used by estates that value farmland under §2032A as of a date in 2002.

Average annual effective interest rates, calculated in accordance with §2032A(e)(7)(A) and §20.2032A-4(e) of the Estate Tax Regulations, to be used under §2032A(e)(7)(A)(ii) , are set forth in the accompanying Table of Interest Rates (Table 1). The states within each Farm Credit Bank District are set forth in the accompanying Table of Farm Credit Bank Districts (Table 2).

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 2001 are in Rev. Rul. 2001-21 (2001-1 C.B. 1144). For rate information for years prior to 2001, see Rev. Rul. 2000-26 (2000-1 C.B. 1124), and other revenue rulings that are referenced therein.

DRAFTING INFORMATION

The principal author of this revenue ruling is Lane Damazo of the Office of the Associate Chief Counsel (Passthroughs and Special Industries). For further information regarding this revenue ruling, contact Lane Damazo at (202) 622-3090 (not a toll-free call).

REV. RUL. 2002-26 TABLE 1
TABLE OF INTEREST RATES
(Year of Valuation 2002)

REV. RUL. 2001-21 TABLE 2
TABLE OF FARM CREDIT BANK DISTRICTS