bulletin Internal Revenue›Rev. Proc. 90-63, 1990-2 C.B. 664, is
SECTION 3. SCOPE
Internal Revenue Bulletin 1997-33 · 2026-10-03 edition · updated 2026-10-04 · United States
The principal-reduction method (described in section 5 of this revenue procedure) applies only to loans that—
(1) are acquired by the taxpayer at origination,
(2) do not have OID or, because the OID is de minimis under § 1.1273–1(d), are treated as not having OID,
(3) are not issued at a premium, (4) are not subject to the election under § 1.1272–3, and
(5) produce ordinary gain or loss when sold or exchanged by the taxpayer.
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