SECTION 1. PURPOSE

This revenue procedure provides automobile dealers (as defined in section 3 of this revenue procedure) with a safe harbor method of accounting for their vehicle parts inventory. This safe harbor method permits automobile dealers to approximate the cost of their vehicle parts inventory using the replacement cost of the vehicle parts pursuant to the replacement cost method described in section 4 of this revenue procedure. This revenue procedure also provides procedures for automobile dealers to obtain the automatic consent of the Commissioner to change to the replacement cost method.