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beneficial ownership; and thereafter such property
interest and beneficial ownership would not be subject
to termination or forfeiture, except on the happening
of a condition subsequent--i.e., a default.
Thus, because the buyer’s obligation to pay the full price under
the agreements in the instant case was otherwise unconditional,
execution of the contracts fixed petitioners’ right to these
sums. Our declaration that “the amount of and right to the
purchase price were fixed and unqualified”, in the context of
another sales agreement which provided for forfeiture of the
contract and retention of all moneys paid in liquidation of
damages, is equally applicable here. Elsinore Cattle Co. v.
Commissioner, a Memorandum Opinion of this Court dated Feb. 21,
1950. Accordingly, both elements for inclusion were met in the
year of signing, the year the transaction was completed for tax
purposes.
This is consistent with the longstanding position of this
Court that the factual predicate requiring income inclusion in a
given year by an accrual method taxpayer is completion of a sale
in that year. For instance, it was held as early as 1925, with
respect to a contract entered in 1918 with all payments to be
made in subsequent years: “The transaction was a completed sale
in the year 1918, and, as the taxpayer kept its books of account
on the accrual basis, the sale price was properly accruable in
that year. We hold, therefore, that the profits arising from the
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