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electing taxpayer account for the insurance expense associated
with the warranty contracts under the method described in Rev.
Proc. 92-97, supra. Petitioners disregarded this requirement and
used a different method to account for insurance expense.
Petitioners effectively argue that they are entitled to do so
because their method of amortizing insurance expense, which
treats the coverage period as if it commenced on the first day of
the taxable year regardless of the actual date, results in better
matching with the prepaid income that is deferred under Rev.
Proc. 92-98, supra, since such income is recognized under a
convention that likewise deems all amounts received on the first
day of the taxable year regardless of actual date. Because of
the matching achieved under their method, petitioners contend it
clearly reflects income while the method sought by respondent
does not.
Petitioners may not avail themselves of the benefits of
deferral provided in Rev. Proc. 92-98, supra, without adhering to
the conditions imposed by the Commissioner. See Mulholland v.
United States, 28 Fed. Cl. 320, 344 (1993) (taxpayers’ failure to
adhere to conditions of a revenue procedure renders them
ineligible for its benefits), affd. 22 F.3d 1105 (Fed. Cir.
1994). Rev. Proc. 92-98, supra, is the only authority cited by
petitioners for the method which defers recognition of a portion
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