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FEDERAL RESERVE BANK O F NEW YORK Fiscal A gent of th e U n ited S tates r C ircular N o. 4 3 9 6 1 L D ecem ber 10, 1956 j Offering of $ 1 ,0 0 0 ,0 0 0 ,0 0 0 of 95-Day Treasury Bills To Be Designated “Tax Anticipation Series” Dated December 17, 1956 M aturing March 22, 1957 To all Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text of a notice published to d ay : F O R R E L E A S E , M O R N IN G N E W S P A P E R S , Monday, Decem ber 10, 1956. TREA SU RY D E PA R T M E N T W ashington T he T reasury Departm ent, by this public notice, invites tenders for $1,000,000,000, or thereabouts, of 95-day T reasury bills, to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. T he bills of this series will be designated T ax Anticipation Series, they will be dated December 17, 1956, and they will m ature M arch 22, 1957. T hey will be accepted a t face value in paym ent of income and profits taxes due on M arch 15, 1957, and to the extent they are not presented for this purpose the face am ount of these bills will be payable w ithout interest a t m aturity. T ax payers desiring to apply these bills in paym ent of March 15, 1957, income and profits taxes have the privilege of surrender ing them to any Federal Reserve Bank or Branch or to the Office of the T reasurer of the U nited States, W ashington, not more than fifteen days before March 15, 1957, and receiving receipts therefor showing the face am ount of the bills so sur rendered. These receipts may be subm itted in lieu of the bills on or before M arch 15, 1957, to the D istrict D irector of Internal Revenue for the district in which such taxes are payable. T he bills will be issued in bearer form only, and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000 (m aturity value). T enders will be received a t Federal Reserve Banks and Branches up to the closing hour, one-thirty o’clock p.m., E astern Standard time, W ednesday, Decem ber 12, 1956. T enders will not be received a t the T reasury D epartm ent, W ashington. Each tender m ust be for an even multiple of $1,000, and in the case of competitive tenders the price offered m ust be expressed on the basis of 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. I t is urged that tenders be made on the printed forms and forwarded in the special envelopes which will be supplied by Federal Reserve Banks or Branches on application therefor. O thers than banking institutions will not be perm itted to submit tenders except for their own account. Tenders will be received w ithout deposit from incorporated banks and tru st companies and from responsible and recognized dealers in invest ment securities. T enders from others m ust be accompanied by paym ent of 2 percent of the face am ount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of paym ent by an incorporated bank or tru st company. Im m ediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcem ent will be made by the T reasury D epartm ent of the am ount and price range of accepted bids. T hose subm itting tenders will be advised of the acceptance or rejection thereof. T he Secretary of the T reasury expressly reserves the right to accept or reject any or all tenders, in whole or in part, and his action in any such respect shall be final. Subject to these reservations, noncompetitive tenders for $200,000 or less without stated price from any one bidder will be accepted in full at the average price (in three decimals) of accepted competitive bids. Paym ent of accepted tenders at the prices offered m ust be made or completed at the Federal Reserve Bank in cash or other immediately available funds on D ecem ber 17, 1956, provided, however, any qualified depositary will be perm itted to make paym ent by credit in its T reasury T ax and Loan Account for T reasury bills allotted to it for itself and its custom ers up to any am ount for which it shall be qualified in excess of existing deposits when so notified by the Federal Reserve Bank of its district. T he income derived from T reasury bills, w hether interest or gain from the sale or other disposition of the bills, does not have any exemption, as such, and loss from the sale or other disposition of T reasury bills does not have any special treat ment, as such, under the Internal Revenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, w hether Federal or State, but are exem pt from all taxation now or hereafter imposed on the principal or interest thereof by any State, or any of the possessions of the U nited States, or by any local taxing authority. F or purposes of taxation the am ount of discount at which T reasury bills are originally sold by the U nited States is considered to be interest. Under Sections 454(b) and 1221(5) of the Internal Revenue Code of 1954 the am ount of discount a t which bills issued hereunder are sold is not considered to accrue until such bills are sold, redeemed or otherw ise disposed of, and such bills are excluded from consideration as capital assets. Accordingly, the owner of T reasury bills (other than life insurance companies) issued hereunder need include in his income tax return only the difference between the price paid for such bills, w hether on original issue or on subsequent purchase, and the am ount actually received either upon sale or redem ption at m aturity during the taxable year for which the return is m ade, as ordinary gain o r loss. T reasury D epartm ent Circular No. 418, Revised, and this notice, prescribe the term s of the T reasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank or Branch. This Bank will receive tenders up to 1 :30 p.m., Eastern Standard time, Wednesday, December 12, 1956, at the Securities Department of its H ead Office and at its Buffalo Branch. Please use the form on the reverse side of this circular to submit a tender, and return it in an envelope marked “Tender for Treasury Bills— T ax Anticipation Series.” Tenders may be submitted by telegraph, subject to written confirm ation; they may not be submitted by telephone. Settlem ent jor accepted tenders m ust be made in cash or other immediately available funds, except that any qualified depositary may make payment by credit in its Treasury T a x and Loan Account jor Treasury bills allotted to it for itself and its customers, up to any amount for which it shall be qualified in excess of existing deposits. A lfred H a y es, President. (O V E R ) IM PO R TA N T—I f you desire to b id on a com petitive basis, fill in ra te p e r 100 and m aturity value in p arag rap h headed “Com petitive Bid.” If you desire to b id on a noncom petitive basis, fill in only th e m atu rity value in p arag ra p h headed “N oncom petitive B id.” DO N O T fill in both paragraphs on one form . A separate ten d er m ust b e used fo r each bid, except th a t banks subm itting bids on a com petitive basis for th e ir own and th e ir custom ers’ accounts m ay subm it one ten d er fo r th e total am ount b id at each price, provided a list is attached showing th e nam e of each bidder, th e am ount b id fo r his account, and m ethod of paym ent. Form s fo r this purpose w ill be furnished upon request. N o.............................. TENDER FOR 95-DAY TREASURY BILLS TO B E DESIGNATED “ TAX A N TIC IPA TIO N SER IES” D ated D ecem ber 17, 1956 M aturing M arch 22, 1957 To F ederal R eserv e B a n k o f N ew Dated at Y ork, Fiscal Agent of the United States. 1956 C O M PETITIV E BID P ursuant to the provisions of Treasury Department Circular No. 418, Revised, and to the provisions of the public notice on December 10, 1956, as issued by the T reasury Department, the N O N CO M PETITIV E BID Pursuant to the provisions of Treasury De partm ent Circular No. 418, Revised, and to the the provisions of the public notice on December 10, 1956, as issued by the Treasury Department, the undersigned offers a noncompetitive tender undersigned o f f e r s ............................................. * for (R a te p er 100) a total amount of $ ...................................................... (m aturity value) of the Treasury bills therein described, or for any less amount that may be awarded, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below: By credit to Treasury T ax and Loan Account □ □ By cash or other immediately available funds for a total amount of $ ............................................... (Not to exceed $2 0 0 ,0 0 0 ) (m aturity value) of the Treasury bills therein described, at the average price (in three decimals) of accepted competitive bids, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below: □ By credit to Treasury T ax and Loan Account □ By cash or other immediately available funds * Price must be expressed on the basis of 100, with not more than three decimal places, fo r example, 99.925. The Treasury bills for which tender is hereby made are to be dated December 17, 1956, and are to mature on M arch 22, 1957. This tender will be inserted in special envelope marked “Tender for Treasury Bills— T ax Anticipation Series! Name of Bidder ( Please p rin t) B y ........ (O fficial signature required) (T itle ) Street Address ...................................... (C ity , T ow n o r V illage, P . O . N o., an d S ta te ) If this tender is subm itted by a bank for the account of a custom er, indicate the custom er’s nam e on line below : (N a m e of C ustom er) (C ity , T o w n o r V illage, P . O . N o., an d S ta te ) IM PO R TA N T INSTRUCTION S: 1. N o tender for less than $1,000 will be considered, and each tender m ust be for an even multiple of $1,000 (m aturity value). 2. If the person making the tender is a corporation, the tender should be signed by an officer of the corporation authorized to make the tender, and the signing of the tender by an officer of the corporation will be construed as a rep resentation by him th at he has been so authorized. If the tender is made by a partnership, it should be signed by a mem ber of the firm, who should sign in the form “ .................................................................................................... a copartnership, by ...........................................................................................................a member of the firm.” 3. T enders will be received w ithout deposit from incorporated banks and tru st companies and from respon sible and recognized dealers in investm ent securities. T enders from others m ust be accompanied by paym ent of 2 percent of the face am ount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of paym ent by an incorporated bank or tru st company. 4. If the language of this tender is changed in any respect, which, in the opinion of the Secretary of the T reasury, is material, the tender may be disregarded. B — 9 TENST B e sure to return tender in special envelope m arked ‘T ender for Treasury B ills— T ax A nticipation Series.” (over)
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