The Internal Revenue Service turned down requests made by portfolio mortgage lenders and finalized a new tax rule that will force these companies to capitalize certain costs incurred in loan production. The good news for lenders is that the new IRS regulation resolves legal disputes that have arisen since a 1991 U.S. Supreme Court ruling in INDOPCO v. Commissioner of the Internal Revenue Service. Until that time, mortgage lenders customarily deducted their loan origination