Rev. Rul. 66-35

A corporation has several issues of bonds outstanding, some of which were issued at a premium, and others at a discount. Such premium and discount are amortizable over the life of the bonds and are reflected in taxable income in accordance with section 1.61-12(c) of the Income Tax Regulations.

Held , amortizable premium and discount with respect to bonds issued by the corporation are reflected in its earnings and profits available for the payment of dividends in the same amount and in the same taxable year that they are properly includible or deductible in computing taxable income. Held further, there is no adjustment to earnings and profits available for the payment of dividends for the amount of unamorized bond premium or discount in respect of bonds outstanding at the end of any taxable year.