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purchaser is not entitled to a full equitable title and the right
to demand the conveyance of the legal title until he has
completely performed his payment obligation.
Federal Tax Consequences
When a bargain sale, in part, constitutes a charitable
contribution, normally the sale will occur at the same time the
gift is complete. See, e.g., Stark v. Commissioner, 86 T.C. at
257. In Baird v. Commissioner, 68 T.C. 115, 124 (1977), this
Court considered when a sale of property occurred for tax
purposes and stated:
The question of when a sale is complete for tax
purposes is essentially one of fact which must be
resolved by an examination of all of the facts and
circumstances, no single one of which is controlling.
The test is one of practicality. Clodfelter v.
Commissioner, 426 F.2d 1391 (9th Cir. 1970), affg. 48
T.C. 694 (1967); Commissioner v. Segall, 114 F.2d 706
(6th Cir. 1940), revg. 38 B.T.A. 43 (1938); Deyoe v.
Commissioner, 66 T.C. 904 (1976). In examining the
circumstances surrounding a conveyance of property to
determine when it has occurred, the focus is directed
to a consideration of when the “benefits and burdens”
of ownership have shifted. Merrill v. Commissioner, 40
T.C. 66 (1963), affd. per curiam 336 F.2d 771 (9th Cir.
1964). And for purposes of real property, a sale is
generally considered to have occurred at the earlier of
the transfer of legal title or the practical assumption
of the benefits and burdens. Dettmers v. Commissioner,
430 F.2d 1019 (6th Cir. 1970), affg. 51 T.C. 290
(1968); Deyoe v. Commissioner, supra.* * *
A closed transaction for Federal tax purposes results from a
contract of sale which is absolute and unconditional on the part
of the seller to deliver to the buyer a deed upon payment of the
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