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OPINION
The parties agree about the substance and requirements of
section 483. Their sole disagreement is whether the first
installments (the July 2, 1984, installments) were due more than
6 months after the date of sale pursuant to a contract containing
unstated interest and requiring payments more than 1 year after
the sale. In essence, the question is whether, in each instance,
a sale occurred during December 1983. If the sales occurred in
December 1983, petitioners will be successful; if the sales
occurred later (less than 6 months before the first installment),
respondent prevails, and petitioners are not entitled to deduct
interest under section 483.5
In Williams v. Commissioner, T.C. Memo. 1992-269, affd.
5For the period under consideration, sec. 483(a) treated as
interest an amount determined by means of a statutory formula and
applied to the principal payments on a pro rata basis. See sec.
1.483-1(a)(1), Income Tax Regs. Amounts so allocated (as imputed
interest) were deductible by a cash basis taxpayer in the year in
which payment was made. If the taxpayer was on the accrual
method of accounting for tax purposes, then the deduction was to
be claimed in the year in which the payment became due. Sec.
1.483-2(a)(1)(ii), Income Tax Regs. Interest imputed under sec.
483 was treated as interest "for all purposes of the Code." Sec.
1.483-2(a)(1)(i), Income Tax Regs. Sec. 483, with certain
exceptions set forth in sec. 483(d), applies
to any payment on account of the sale or exchange of
property which constitutes part or all of the sales
price and which is due more than 6 months after the
date of such sale or exchange under a contract * * *
under which some or all of the payments are due more
than 1 year after the date of such sale or exchange
* * * [Sec. 483(c).]
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