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it. Respondent's primary objection to petitioner's use of that
revenue procedure is the argument that the annual credit card
fees do not represent payments for services under the cardholder
agreement, a factual issue we have resolved in petitioner's
favor. Almost as an afterthought, respondent argues that
petitioner's accounting method for these annual fees does not
clearly reflect income, an argument based upon an insistence that
Rev. Proc. 71-21 requires a matching of income and expense on an
individual cardholder basis. Petitioner admittedly does not
track the expenses for these services on an individual cardholder
basis. Having then decided that the revenue procedure, as thus
interpreted by respondent, does not apply to petitioner,
respondent concludes there is thus no abuse of discretion in
denying petitioner the use of Rev. Proc. 71-21. We think
respondent's approach is inconsistent with the intended purpose
and benefit of the revenue procedure, that petitioner's pro rata
reporting of these fees over a 12-month period satisfies Rev.
Proc. 71-21, and that respondent's denial of the benefits of the
revenue procedure to petitioner amounts to an abuse of
discretion.
In 1970, respondent issued Rev. Proc. 70-21, 1970-2 C.B.
501,
to implement an administrative decision, made by the
Commissioner of Internal Revenue in the exercise of his
discretion under section 446 of the Internal Revenue
Code of 1954, to allow accrual method taxpayers in
certain specified and limited circumstances to defer
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