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FEDERAL RESERVE BANK
OF NEW YORK
Fiscal Agent of the United States
'Circular No. 2 3 72T
. January 30, 1942 J

TREASURY FOLDER "TAX SAVINGS NOTES"

To All Banks and Trust Companies
in the Second Federal Reserve District:

This bank has received a supply of a folder entitled "Tax Savings
Notes" prepared by the Treasury Department covering Treasury Notes
of Tax Series A-1944 and Treasury Notes of Tax Series B-1944. The
folder contains a summary of Treasury Circular No. 674, dated December
15,1941, a copy of which was transmitted with Circular No. 2347 of this
bank, dated December 31,1941. The earlier leaflet entitled " Tax Savings
Plan", a copy of which was enclosed with Circular No. 2318 of this
bank, dated November 19,1941, is supplanted by this folder and should
no longer be distributed.
Five copies of the new folder "Tax Savings Notes" are enclosed.
Should you have need of additional copies, this bank will appreciate
your returning the enclosed card after having indicated thereon the
number of copies you desire.




ALLAN SPROUL,

President.

TABLE OF PURCHASE PRICE AND
TAX PAYMENT VALUE
Purchase price and tax-payment value during
successive months of $100 Treasury Tax Notes
dated January 1942, Series A and B (par and
accrued interest, during successive months;
other denominations in proportion)
The total shown for any denomination for any
month—January through December 1942—
while the notes remain on sale, is the purchase
price, or cost of the note during that month.
Also the total shown for any denomination for
any month—January 1942 through January
1944—is the tax-payment value of the note if
receivable during that month in payment of
taxes.
1942
January
February
March
April
May
June
July
August
September
October
November
December

Series A

Series B

$100.00
100.16
100.32
100.48
100.64
100.80
100.96
101.12
101.28
101.44
101.60
101.76

$100.00
100.04
100.08
100.12
100.16
100.20
100.24
100.28
100.32
100.36
100.40
100.44

101.92
102.08
102.24
102.40
102.56
102.72
102.88
103.04
103.20
103.36
103.52
103.68

100.48
100.52
100.56
100.60
100.64
100.68
100.72
100.76
100.80
100.84
100.88
100.92

103.84

100.96

1943
January
February
March
April
May
June
July
August
September
October
November
December

1944
January
U. S. GOVERNMENT PRINTING OFFICE




16—26153-1

UNITED

STATES

TREASURE

TAX
SAVINGS
NOTES
Tax Series A-1944

Tax Series B-194

Dated Jan. 1, 1942—Due Jan. 1. 1944
Issued at par and accrued interest. Accep
able at par and accrued interest in paymei
of Federal income, estate, and girt taxes.

FOR THE NATIONAL WAR PROGRA/^
greatly increased taxes are necessary, cons
quently, as income is received, the taxpay<
should set aside the amount necessary to pay tr
taxes due the following year. This can be dor
by purchasing Treasury Tax Notes on a regul;
schedule, from current income, and later usir.
them in paying Federal income, estate, and gi
taxes.
TWO SERIES. Two series are available; Seri
A, designed to be particularly attractive to tl
small or moderate taxpayers, and Series B, i
tended for the larger taxpayers. The notes cu
rently on sale will be dated January 1,1942, ar
mature January 1, 1944.

.

UCE OF NOTES. The notes of both series
e sold at par and accrued interest from their
ite to month of purchase. Defense Savings
amps will be accepted at face value in payment
r these Treasury Tax Notes. When the notes
e used to. pay taxes, the taxpayer is given credit
r the accrued interest which was included in
e purchase price, plus the further interest
crued while the notes were in the taxpayer's
^session.
ENOMINATIONS. Series A, $25, $50, $100,
500, $1,000; Series B, $100, $500, $1,000,
..0,000, $100,000, $500,000, $1,000,000.
1TEREST. Interest accrues on Series A at rate
" 16 cents a month per $100. That is at a rate
' about 1.92 percent a year. Interest accrues on
;ries D at 4 cents a month per $100. That is at
rate of about 0.48 percent a year.
terest accrued after purchase is allowed only
) notes used for tax payments. Interest will
>t accrue after the maturity of the notes.
\ X PAYM ENTS. The notes are inscribed with
e name of the taxpayer and are nonnegotiable.
hey may be used by the owner, his agent, or
s estate in payment of Federal income taxes
rurrent and back personal and corporation taxes
id excess-profits taxes) assessed against his
come; also in payment of Federal estate and
ft taxes. They may be so used when at least
le full calendar month has intervened between
e month of acceptance and the month of purlase. For example, a note of Tax Series
-1944 purchased in April 1942 may be acpted in June 1942, but such a note purchased
May 1942 may not be accepted until July
)42.
The notes are receivable in payment
the above-mentioned taxes at par, plus accrued
terest from their date to and including the
onth in which they are presented to the Collecr of Internal Revenue.
MOUNTS ACCEPTABLE, SERIES A. Not
ore than $1,200 principal amount and accrued
terest thereon of Series A notes of any date and



maturity will be accepted on account of a taxpayer's liability for each taxable period. But in
the case of a joint return, this limitation applies
separately to both husband and wife. Similarly
it applies separately to decedent before death and
also to his estate for the balance of the same year.
The $1,200 limitation also applies separately to
each of the three classes of taxes (income, estate,
and gift) for which these notes are acceptable.
AMOUNTS ACCEPTABLE, SERIES B. No
limit is placed on the amount of Series B notes
acceptable, either alone or in addition to Series
A notes. Tax notes, both Series A and Series B,
will be received in payment of taxes only in
amounts of their denominations plus accrued
interest.
TAXABILITY. Interest accrued after purchase
has no exemption from Federal income tax, but
should be reported as income for the year in
which the notes are used for tax payment.
PvEDEMPTION. Notes not used for tax-payment purposes may be redeemed, in whole or in
part (corresponding to an authorized denomination), at the purchase price only; that is, at the
face value of the note, plus the interest accrued
at the time of purchase. Series A notes may be
redeemed at any time; Series B notes after 60
days from date of issue, on 30 days' notice.
PURCHASE OF NOTES. Tax notes may be
purchased from any Federal Reserve bank or
branch or from the Treasurer of the United
States, Washington, D. C. Banks, trust companies, investment houses, securities dealers, and
savings and loan associations generally throughout the United States will secure the notes for
their customers, making no charge for this service. For any special information concerning the
acceptance of these notes in payment of Federal
income, estate, and/or gift taxes, consult the
nearest Collector of Internal Revenue.

""(Cut along"tfaii"irne>
APPLICATION FOR U. S. TREASURY TAX NOTES

To the Federal Reserve bank of

Tax Series A—Tax Series B
NUMBER
OF NOTES

DENOMINATION

(Face value)

Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series
Tax Series

PURCHASE PRICE

(See previous page)

A $25
;
A $50
A $100
A $500
A $1,000
B $100
B $500
B $1,000
B $10,000
B $100,000
B $500,000
B $1,000,000

 of purchase
Total amount


(remittance herewith) $

AMOUNT

(Total cost)

The undersigned hereby applies for United States Treasury
Notes of n T a x Series A QTax Series B as indicated on
the form to the left.
(Draw remittances to the Treasurer of the United States.)
(Purchaser's name—type or print plainly)
(Signature of purchaser)
(Address of purchaser)

will be forwarded by registered mail to address above unless other instructions are given
DELIVERY INSTRUCTIONS.—Notes

here
(IMPORTANT—Refer to table on back page before filling in Purchase Price.)

Questions & Answers
Q. Is $1,200 the absolute limit of Series A
Notes that an individual taxpayer can use in
any one taxable period?
A. Yes; but if husband and wife file a joint
income tax return, each of them may use
$1,200 of Series A Notes in payment—a
total of $2,400.
Q. During that same year could a taxpayer use
Series A Notes in payment of Federal gift
taxes?
A. Yes; during that same
could also use $1,200 of
gift tax payments. In
estate could use another
of Federal estate tax.

year, any taxpayer
Series A Notes for
case of death, his
$1,200 in payment

Q. What happens to a person's Treasury TaxSavings Notes if he dies?
A. The notes can be presented by the estate for
the payment of income taxes due from the
decedent; or they can be redeemed for the
amount paid for them.
Q. / / necessary, can these Tax Savings Notes
be sold?
A. N o ; but the purchaser may present them for
redemption at the price he paid for them.
Unless they are used for payment of taxes
they earn no interest, but also there is no risk
of receiving less than was paid for them.
Q. Can these Tax Savings Notes be used as
collateral?
A. N o ; nor are they transferable. If lost or
stolen they cannot be used by any other
person than the purchaser.




Please send us
additional copies of the folder prepared
by the Treasury Department, entitled "Tax Savings Notes", referred
to in your Circular No. 2372.

(Date)



(Xame—typewrite or print)

(Signature)

(Street Address)

(City or Town)

(State)

FEDERAL RESERVE BANK OF NEW YORK




Federal Reserve Station, P. O.,
New York, N. Y


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102