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FEDERAL RESERVE BANK OF N EW YORK Fiscal A gen t o f the United States r C ircu la r N o . 6 4 2 2*1 L O cc t o b e r 17 17,, 1969 J Offering of $3,000,000,000 of 236-Day Tax Anticipation Treasury Bills Dated October 29, 1969, Due June 22, 1970 To All Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: The following 'Statement was made public today by the Treasury Department: I he I reasury Department today announced the sale of $3 billion of tax anticipation bills which will mature in June 1970. The bills will be auctioned on Thursday, October 23, for payment on Wednesday, October 29. Commercial banks may make payment for their own and their customers’ accepted tenders by credit to Treasury T ax and Loan Accounts. The bills will mature on June 22, 1970, but may be used at face value in payment of Federal income taxes due on June 15, 1970. Following is the text of the public notice offering the bills referred to in the above statement: The Treasury Department, by this public notice, invites tenders for $3,000,000,000, or thereabouts, of 236-day Treasury bills to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. The bills of this series will be dated October 29, 1969, and will mature June 22, 1970. They will be accepted at face value in payment of income taxes due on June 15, 1970, and to the extent they are not presented for this purpose the face amount of these bills will be payable without interest at maturity. Taxpayers desiring to apply these bills in payment of June 15, 1970 income taxes may submit the bills to a Federal Reserve Bank or Branch or to the Office of the Treasurer of the United States, Washington, not more than fifteen days before that date. In the case of bills submitted in payment of income taxes of a corporation they shall be accompanied by a duly completed Form 503 and the office receiving these items will effect the deposit on June 15, 1970. In the case of bills submitted in payment of income taxes of all other taxpayers, the office receiving the bills will issue receipts therefor, the original of which the taxpayer shall submit on or before June 15, 1970, to the District Director of Internal Revenue for the District in which such taxes are payable. The bills will be issued in bearer form only, and in denominations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (maturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Daylight Saving time, Thursday, October 23, 1969. Tenders will not be received at the Treasury Department, Washington. Each tender must be for an even multiple of $1,000, and in the case of competitive tenders the price offered must be expressed on the basis of 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. It 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. Banking institutions generally may submit tenders for account of customers, provided the names of the customers are set forth in such tenders. Others than banking institutions will not be permitted to submit tenders except for their own account. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by payment of 2 percent o f the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. All bidders are required to agree not to purchase or to sell, or to make any agreements with respect to the purchase or sale or other disposition of any bills of this issue at a specific rate or price, until after one-thirty p.m., Eastern Daylight Saving time, Thursday, October 23, 1969. Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price range of accepted bids. Those sub mitting tenders will be advised of the acceptance or rejection thereof. The Secretary of the Treasury 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 $400,000 or less without stated price from any one bidder will be accepted in full at the average price (in three decimals) of accepted com petitive bids. Payment of accepted tenders at the prices offered must be made or completed at the Federal Reserve Bank in cash or other immediately available funds on October 29, 1969, provided, however, any qualified depositary will be permitted to make settlement by credit in its Treasury Tax and Loan Account for Treasury bills allotted to it for itself and its cus tomers up to any amount for which it shall be qualified in excess of existing deposits when so notified by the Federal Reserve Bank of its District. The income derived from Treasury bills, whether 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 Treasury bills does not have any special treat ment, as such, under the Internal Revenue Code of 1954. The bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exempt from all taxa tion now or hereafter imposed on the principal or interest thereof by any State, or any of the possessions of the United States, or by any local taxing authority. For purposes of taxation the amount of discount at which Treasury bills are originally sold by the United States is considered to be interest. Under Sections 454(b) and 1221(5) of the Internal Revenue Code of 1954 the amount of discount at which bills issued hereunder are sold is not considered to accrue until such bills are sold, redeemed or otherwise disposed of, and such bills are excluded from consideration as capital assets. Accordingly, the owner of Treasury bills (other than life insurance com panies) issued hereunder need include in his income tax return only the difference between the price paid for such bills, whether on original issue or on subsequent purchase, and the amount actually received either upon sale or redemption at maturity during the taxable year for which the return is made, as ordinary gain or loss. Treasury Department Circular No. 418 (current revision) and this notice prescribe the terms of the Treasury 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 Daylight Saving time, Thursday, October 23, 1969, at the Securities Department of its Head 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 the enclosed blue envelope marked “ Tender for T ax Anticipation Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Settlement for accepted tenders must be made in cash or other immediately available funds on October 29, 1969, except that any qualified depositary may make settlement by credit in its Treasury T ax and Loan Account for Treasury bills allotted to it for itself and its customers. A lfr e d H ayes, President. ( over ) Advice of Deposit in Treasury Tax and Loan Account To F ed era l R eserve B an k o f N ew Y ork , Fiscal Agent of the United States W e will deposit on October 29, 1969 to your credit in the Treasury T ax and Loan Account on our books, to be held subject to withdrawal on demand, an amount equal to the purchase price, rounded to the next higher $1,000, of the bills allotted to us on our tender for 236-day tax anticipation Treasury bills, dated October 29, 1969, due June 22, 1970. (N am e o f Depositary) B y ........ (A uthorized signature (s ) required) Address (C it y and S ta te ) IMPORTANT- -Please make certain that all requested data is supplied on this form, including the number and denomination of pieces desired and the delivery and payment instructions. TENDER FOR 236-DAY T A X ANTICIPATION TREASURY BILLS Dated October 29, 1969 To F ed era l R eserve B an k o f N ew Due June 22, 1970 Dated a t ....................................... Y ork , Fiscal Agent of the United States. 19. Pursuant to the provisions of Treasury Department Circular N o. 418 (current revision) and to the provi sions of the public notice issued by the Treasury Department inviting tenders for the above-described Treasury bills, the undersigned hereby offers to purchase such Treasury bills in the amount indicated below, and agrees to make payment therefor at your Bank on or before the issue date at the price indicated b elow : C O M P E T IT IV E TE N D E R [ D o not fill in both Competitive and Noncompetitive tenders on one form $ .............................................................(maturity value), or any lesser amount that may be awarded. P r i c e : .....................................per 100. (Price must be expressed with not more than three decimal places, for example, 99.925) ] N O N C O M PE TITIV E TE N D E R $ ........................................................ (maturity value). (N ot to exceed $400,000 for one bidder through all sources) at the average price of accepted competitive bids. W e hereby agree not to buy or to sell, or to make any agreements with respect to the purchase or sale or other disposition of any bills of this issue at a specific rate or price, until after one-thirty p.m., Eastern Day light Saving time, Thursday, October 23,1969. Subject to allotment, please issue, deliver, and accept payment for the bills as indicated below: Pieces Denomination $ Maturity value 1,000 □ □ n 5,000 10,000 □ 50,000 u 100,000 1. Deliver over the counter to the undersigned 2. Ship to the undersigned 3. Hold in safekeeping (for ac count of member bank only)* 4. Hold as collateral for Treas ury Tax and Loan Account* 5. Special instructions: Payment will be made as follows: □ By check herewith □ By cash or check in immediately available funds on delivery □ By charge to our reserve account □ By credit in Treasury Tax and Loan Account. (Please complete Advice of Deposit below.) 500,000 1,000,000 (iv u cnunyes in aenvery insiruc nuns will be accepted) Totals * The undersigned certifies that the allotted bills will be owned solely by the undersigned. (N am e o f subscriber— please print or type) Insert this tender in special envelope marked “Tender for Tax Anticipation Treasury BUls” (Address— please print or type) (Signature of subscriber or authorized signature) (T itle of authorized signer) (Banks submitting tenders for customer account must indicate name on line below, or attach a list) Nam e of Customer Name o f Customer IN S T R U C T IO N S : 1. No tender for less than $1,000 will be considered and each tender must be for an even multiple of $1,000 (maturity value). 2. Others than banking institutions will not be permitted to submit tenders except for their own account. Banks submitting tenders for customer account may consolidate competitive tenders at the same price and may consolidate non competitive tenders, provided a list is attached showing the name of each bidder, the amount bid for his account, and method of payment! Forms for this purpose will be furnished on request. 3 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 representation by him that he has been so authorized. If the tender is made by a partnership, it should be signed by a member of the firm, who should sign in the form “ .............. ................................................................ . a copartnership, by ................................................................ . a member of the firm. 4 Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. All checks must be drawn to the order of the Federal Reserve Bank of New Y ork; checks endorsed to this Bank will not be accepted. 5. If the language of this tender is changed in any respect, which, in the opinion of the Secretary of the Treasury, the tender mav be disregarded.
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