Part IV. Applicable Federal Interest Rates

TABLE OF APPLICABLE FEDERAL INTEREST RATES

FOR PURPOSES OF § 807

Year Interest Rate

2006 3.98

2007 3.97

Sources: Rev. Rul. 2004–106, 2004–2 C.B. 893, for the 2005 rate; Rev. Rul. 2005–77, 2005–2 C.B. 1071, for the 2006 rate; and Rev. Rul. 2006–61, 2006–49 I.R.B. 1028 (Dec. 11, 2006) for the 2007 rate.

Section 1441.—Withholding of Tax on Nonresident Aliens

A revenue procedure provides administrative guidance permitting the use of a “Net Consideration Method” of accounting for certain patent cross licensing arrangements. Under the method, only cash and other non-patent-right consideration are taken into account for withholding and capitalization purposes. See Rev. Proc. 2007-23, page 675.

EFFECT ON OTHER REVENUE RULINGS

Rev. Rul. 92–19 is supplemented by the addition to Part III of that ruling of prevailing state assumed interest rates under § 807 for certain insurance products issued in 2006 and 2007 and is further supplemented by an addition to the table in Part IV of Rev. Rul. 92–19 listing applicable federal interest rates. Parts I and II of Rev. Rul. 92–19 are not affected by this ruling.

DRAFTING INFORMATION

The principal author of this revenue ruling is Josephine H. Firehock of the Office of Associate Chief Counsel (Financial Institutions and Products). For further information regarding this revenue ruling, contact her at (202) 622–3970 (not a toll-free call).

March 5, 2007 664 2007–10 I.R.B.