The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
c_r\/Ai_ K t s L K V t B A N K O F N E W Y O R K
Fiscal Agent of the United States
r Circular No. 684 2 "I
t- November 18, 1971 J
Offering of $2,500,000,000 of 142-Day Tax Anticipation Treasury Bills
Dated December 1,1971, Due April 21, 1972
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:
The Treasury Department today announced the sale of $2.5 billion of tax anticipation bills which will
mature in April 1972.
The bills will be auctioned on Wednesday, November 24, for payment on Wednesday, December 1. Com
mercial banks may make payment for up to 50% of their own and their customers’ accepted tenders by credit
ing Treasury tax and loan accounts.
The bills will mature on April 21, 1972, but may be used at face value in payment of Federal income
taxes due on April 15, 1972.
The Treasury also said that in the first week of December it will announce another sale of a smaller
amount of tax anticipation bills which will mature in June 1972.
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 $2,500,000,000, or thereabouts, of 142-day Treasury
bills, to be issued on a discount basis under competitive and non
competitive bidding as hereinafter provided. The bills of this
series will be dated December 1, 1971, and will mature April 21,
1972 (CUSIP No. 912793 N R3). They will be accepted at face
value in payment of income taxes due on April 15, 1972, 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 April 15,
1972 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 corpo
ration they shall be accompanied by a duly completed Form 503
and the office receiving these items will effect the deposit on
April 15, 1972. 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 April 15, 1972, 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 $10,000, $15,000, $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 Standard
time, Wednesday, November 24, 1971. Tenders will not be
received at the Treasury Department, Washington. Each tender
must be for a minimum of $10,000. Tenders over $10,000 must be
in multiples of $5,000. 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 for
warded 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 accom
panied by payment of 2 percent of the face amount of Treasury
bills applied for, unless the tenders are accompanied by an ex
press 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 Standard time,
Wednesday, November 24, 1971.
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. Only those
submitting competitive tenders will be advised of the acceptance
or rejection thereof. The Secretary of the Treasury expressly re
serves 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. Settlement for accepted tenders in accordance with
the bids must be made or completed at the Federal Reserve Bank
in cash or other immediately available funds on December 1, 1971.
Any qualified depositary will be permitted to make settlement by
credit in its Treasury Tax and Loan Account for not more than
50 percent of the amount of Treasury bills allotted to it for itself
and its customers.
Under Sections 4 5 4 (b ) and 1221(5) of the Internal Revenue
Code of 1954, the amount of discount at which bills issued here
under are sold is considered to accrue when the bills are sold,
redeemed or otherwise disposed of, and the bills are excluded from
consideration as capital assets. Accordingly, the owner of Treas
ury bills (other than life insurance companies) issued hereunder
must include in his income tax return, as ordinary gain or loss,
the difference between the price paid for the 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.
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 Standard time, Wednesday, November 24, 1971, 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 envelope marked “Tender for Tax Anticipation
Treasury Bills.” Tenders not requiring a deposit 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 immedi
ately available funds on December 1, 1971, except that any qualified depositary may make settlement by credit in its
Treasury Tax and Loan Account for not more than 50 percent of the amount of Treasury bills allotted to it for
itself and its customers.
A lfr ed H
ayes,
President.
(o v e r )
.. ^ - n ea se uiitivc tcu am
— , ---------
number and denomination of pieces desired and the delivery and payment instructions.
TENDER FOR 142-DAY TAX ANTICIPATION TREASURY BILLS
Dated December 1,1971
To
Due April 21,1972
Dated a t ......................................................
F e d e r a l R eserve B an k o f N e w Y ork ,
Fiscal Agent of the United States.
19.
Pursuant to the provisions of Treasury Department Circular No. 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 below:
COM PETITIVE TENDER
|Do not fill in both Competitive and\
{_Noncompetitive tenders on one forrnj
NONCOMPETITIVE TENDER
$ ...................................................... ( maturity value),
or any lesser amount that may be awarded.
$ ...................................................... ( maturity value).
P r ic e :................................ per 100.
at the average price of accepted competitive bids.
( Not to exceed $400,000 for one bidder through all sources)
( Price must be expressed with not more than three
decimal places, for example, 99.925)
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
Standard time, W ednesday, Novem ber 24,1971.
Subject to allotment, please issue, deliver, and accept payment for the bills as indicated below:
Pieces
Denomination
$
Maturity value
10,000
15,000
50,000
□
1.
Deliver over the counter to the
undersigned
□
2.
Ship to the undersigned
□
3.
Hold in safekeeping ( for ac
count o f member bank only)*
□
4.
Hold as collateral for Treas
ury Tax and Loan Account*
□
5.
Special instructions:
100,000
Payment will be made as follows:
□
By charge to our reserve account
u
By cash or check in immediately
available funds on delivery
□
By credit in Treasury Tax and
Loan Account ( not more
than 50% of purchase price)
for which Advice o f Deposit
(below ) is submitted here
with.
500,000
1,000,000
(N o changes in delivery instructions
will be accepted )
Totals
* The undersigned certifies that the allotted bills will be owned solely by the undersigned.
( Name of subscriber — please print or type)
Insert this tender
in special envelope
marked “Tender for
Tax Anticipation
Treasury Bills”
(Address — please print or type)
(Tel. No.)
(Signature of subscriber or authorized signature)
(Title of authorized signer)
(Banks submitting tenders for customer account must indicate name on line below, or attach a list)
( N a m e of customer)
( N a m e of customer)
INSTRUCTIONS:
1. No tender for less than $10,000 will be considered and each tender must be for an even multiple of $5,000
(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 repre
sentation 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 York;
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,
is material, the tender may be disregarded.
Advice of Deposit in Treasury Tax and Loan Account
To
F e d e r a l R eserve B an k o f N e w Y ork ,
Fiscal Agent of the United States.
W e will deposit on December 1, 1971 to your credit in the Treasury Tax and Loan Account on our books, to be held
subject to withdrawal on demand, an amount not exceeding 50% of the purchase price of the bills allotted to us on our
tender for 142-day tax anticipation Treasury bills, dated December 1, 1971, due April 21, 1972.
( Name of Depositary)
By ..........................................................................
(Authorized signature(s) required)
Address .................................................................................
( City and State)
@FedFRASER