SECTION 1. PURPOSE

This revenue procedure allows a taxpayer to use a safe harbor method of accounting for original issue discount

(“OID”) on a pool of credit card receivables for purposes of § 1272(a)(6) of the Internal Revenue Code (“Code”)—the “proportional method.” The proportional method generally allocates to an accrual period an amount of unaccrued OID that is proportional to the amount of the stated redemption price at maturity (“principal”) of the pool that is paid by cardholders during the period. The proportional method described in this revenue procedure gen

2013–22 I.R.B. 1160 May 28, 2013

.01 The taxpayer holds receivables arising from credit cards that allow cardholders to access a revolving line of credit to purchase goods and services, or to obtain cash advances;

.02 For federal income tax purposes, the credit card purchase transactions of the cardholders do not create debt that is given in consideration for the sale or exchange of property;

.03 The taxpayer maintains one or more pools of receivables with respect to such credit cards (or one or more pools of receivables with respect to such credit cards are maintained on the taxpayer’s behalf); and

.04 In the case of a taxpayer that maintains (or on whose behalf are maintained) more than one pool of credit card receivables, the manner in which pools are established and maintained does not achieve a result that is unreasonable in light of the purposes of §§ 1271 through 1275.