§ 483. Interest on certain deferred payments

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1964

   Revenue Act of 1964

   Pub. L. 88–272 title II § 224(a) · 78 Stat. 19

   Enacted · 26 U.S.C. § 483

   Added Pub. L. 88–272, title II, § 224(a), Feb. 26, 1964, 78 Stat. 77

   Source evidence

   Code source credit
   Added Pub. L. 88–272, title II, § 224(a), Feb. 26, 1964, 78 Stat. 77

   Enacted provision · exact public law section
   (a) In General.— Part III of subchapter E of chapter 1 (relating 68A Stat. 160. 26 USC 481, 482. to accounting periods and methods of accounting) is amended by adding at the end thereof the following new section: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any contract for the sale or exchange of property there shall be treated as interest that part of a payment to which this section applies which bears the same ratio to the amount of such payment as the total unstated interest under such contract bears to the total of the payments to which this section applies which are due under such contract. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of paragraph (2), the present value of a payment shall be determined, as of the date of the sale or exchange, by discounting such payment at the rate, and in the manner, provided in regulations prescribed by the Secretary or his delegate. Such regulations shall provide for discounting on the basis of 6-month brackets and shall provide that the present value of any interest payment due not more than 6 months after the date of the sale or exchange is an amount equal to 100 percent of such payment. “(c) Payments to Which Section Applies.— “(1) In general.— Except as provided in subsection (f), this section shall apply 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— “(A) under which some or all of the payments are due more than one year after the date of such sale or exchange, and “(B) under which, using a rate provided by regulations prescribed by the Secretary or his delegate for purposes of this subparagraph, there is total unstated interest. Any rate prescribed for determining whether there is total unstated interest for purposes of subparagraph (B) shall be at least one percentage point lower than the rate prescribed for purposes of subsection (b)(2). “(2) Treatment of evidence of indebtedness.— For purposes of this section, an evidence of indebtedness of the purchaser given in consideration for the sale or exchange of property shall not be considered a payment, and any payment, due under such evidence of indebtedness shall be treated as due under the contract for the sale or exchange. “(d) Payments That Are Indefinite as to Time, Liability, or Amount.— In the case of a contract for the sale or exchange of property under which the liability for, or the amount or due date of, any portion of a payment cannot be determined at the time of the sale or exchange, this section shall be separately applied to such portion as if it (and any amount of interest attributable to such portion) were the only payments due under the contract; and such determinations of liability, amount, and due date shall be made at the time payment of such portion is made. “(e) Change in Terms of Contract.— If the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property is changed, the ‘total unstated interest’ under the contract shall be recomputed and allocated (with adjustment for prior interest (including unstated interest) payments) under regulations prescribed by the Secretary or his delegate. “(f) Exceptions and Limitations.— “(1) Sales price of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,600. “(2) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such 68A Stat. 46. 26 USC 163. amounts are treated under section 163(b) as if they included interest. “(3) Treatment of seller.— In the case of the seller, the tax treatment of any amounts received on account of the sale or exchange of property shall be made without regard to this section if no part of any gain on such sale or exchange would be considered as gain from the sale or exchange of a capital asset or 26 USC 1231. property described in section 1231. “(4) Sales or exchanges of patents.— This section shall not apply to any payments made pursuant to a transfer described in 26 USC 1235. section 1235 (a) (relating to sale or exchange of patents). “(5) Annuities.— This section shall not apply to any amount the liability for which depends in whole or in part on the life expectancy of one or more individuals and which constitutes an amount received as an annuity to which section 72 68A Stat. 20; 76 Stat. 821, 1005. 26 USC 72. applies.”

2. 1976

   Pub. L. 94–455 § 1906(b)(13)(A) · 90 Stat. 1520

   Struck · 26 U.S.C. § 483(b); 26 U.S.C. § 483(c)(1)(B); 26 U.S.C. § 483(e)

   Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”

   Source evidence

   Code amendment note
   Subsecs. (b), (c)(1)(B), (e). Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”.

   Enacted provision · exact public law section
   (A) The Internal Revenue Code of 1954, as amended by this Act, is amended by striking out “Secretary or his delegate” each place it appears and inserting in lieu thereof “Secretary”.

3. 1976

   Pub. L. 94–455 § 1901(b)(3)(B) · 90 Stat. 1520

   Substituted · 26 U.S.C. § 483(f)(3)

   Pub. L. 94–455, § 1901(b)(3)(B), substituted “all of the gain, if any, on such” for “no part of any gain on such” and “ordinary income” for gain from the sale or exchange of property other than a capital asset”

   Source evidence

   Code amendment note
   Subsec. (f)(3). Pub. L. 94–455, § 1901(b)(3)(B), substituted “all of the gain, if any, on such” for “no part of any gain on such” and “ordinary income” for gain from the sale or exchange of property other than a capital asset”.

   Enacted provision · exact public law section
   (B) Section 483(f)(3) is amended by striking out “no part of any gain on such” and inserting in lieu thereof “all of the gain, if any, on such” and by striking out “gain from the sale or exchange of a capital asset or property described in section 1231” and inserting in lieu thereof “ordinary income”.

4. 1981

   Economic Recovery Tax Act of 1981

   Pub. L. 97–34 title I § 126(a) · 95 Stat. 175

   Added · 26 U.S.C. § 483(g)

   Pub. L. 97–34 added subsec. (g)

   Source evidence

   Code amendment note
   Subsec. (g). Pub. L. 97–34 added subsec. (g).

   Enacted provision · exact public law section
   (a) General Rule.— Section 483 (relating to interest on certain deferred payments) is amended by adding at the end thereof the following new subsection: “(g) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties.— “(1) In general.— In the case of any qualified sale, the maximum interest rate used in determining the total unstated interest rate under the regulations under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation.— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— This section shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual.”

5. 1983

   Pub. L. 97–448 title I § 101(g) · 96 Stat. 2365

   Substituted · 26 U.S.C. § 483(g)(4)

   Pub. L. 97–448 substituted “Paragraph (1)” for “This section”

   Source evidence

   Code amendment note
   Subsec. (g)(4). Pub. L. 97–448 substituted “Paragraph (1)” for “This section”.

   Enacted provision · exact public law section
   (g) Amendment Related to Section 126.— Paragraph (4) of section 95 Stat. 202. 26 USC 483. 483(g) (relating to nonresident alien individuals) is amended by striking out “This section” and inserting in lieu thereof “Paragraph (1)”.

6. 1984

   Tax Reform Act of 1984

   Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

   1. Amended · 26 U.S.C. § 483(a)

      Pub. L. 98–369 amended subsec. (a) generally

   2. Substituted · 26 U.S.C. § 483(a)

      Pub. L. 98–369 substituting “For purposes of this title, in the case of any payment (1) under any contract for the sale or exchange of any property, and (2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment” for “For purposes of this title, in the case of any contract for the sale or exchange of property there shall be treated as interest that part of a payment to which this section applies which bears the same ratio to the amount of such payment as the total unstated interest under such contract bears to the total of the payments to which this section applies which are due under such contract”

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 98–369 amended subsec. (a) generally, substituting “For purposes of this title, in the case of any payment (1) under any contract for the sale or exchange of any property, and (2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment” for “For purposes of this title, in the case of any contract for the sale or exchange of property there shall be treated as interest that part of a payment to which this section applies which bears the same ratio to the amount of such payment as the total unstated interest under such contract bears to the total of the payments to which this section applies which are due under such contract”.

   Enacted provision · exact public law section
   (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

   Effective date note
   Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

7. 1984

   Tax Reform Act of 1984

   Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

   1. Amended · 26 U.S.C. § 483(b)

      Pub. L. 98–369 amended subsec. (b) generally

   2. Substituted · 26 U.S.C. § 483(b)

      Pub. L. 98–369 substituting provisions directing that the present value of a payment be determined under the rules of section 1274(b)(2) using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d) for provisions which had directed that the present value of a payment be determined, as of the date of the sale or exchange, by discounting such payment at the rate, and in the manner, provided in regulations prescribed by the Secretary and that such regulations provide for discounting on the basis of 6-month brackets and provide that the present value of any interest payment due not more than 6 months after the date of the sale or exchange was to have been an amount equal to 100 percent of such payment

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 98–369 amended subsec. (b) generally, substituting provisions directing that the present value of a payment be determined under the rules of section 1274(b)(2) using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d) for provisions which had directed that the present value of a payment be determined, as of the date of the sale or exchange, by discounting such payment at the rate, and in the manner, provided in regulations prescribed by the Secretary and that such regulations provide for discounting on the basis of 6-month brackets and provide that the present value of any interest payment due not more than 6 months after the date of the sale or exchange was to have been an amount equal to 100 percent of such payment.

   Enacted provision · exact public law section
   (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

   Effective date note
   Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

8. 1984

   Tax Reform Act of 1984

   Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

   Substituted · 26 U.S.C. § 483(c)

   Pub. L. 98–369 substituted “subsection (a) applies” for “section applies” in heading

   Source evidence

   Code amendment note
   Subsec. (c). Pub. L. 98–369 substituted “subsection (a) applies” for “section applies” in heading.

   Enacted provision · exact public law section
   (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

   Effective date note
   Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

9. 1984

   Tax Reform Act of 1984

   Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

   1. Substituted · 26 U.S.C. § 483(c)(1)

      Pub. L. 98–369 substituted “under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest” for “under which, using a rate provided by regulations prescribed by the Secretary for purposes of this subparagraph, there is total unstated interest”, in subpar. (B)

   2. Struck · 26 U.S.C. § 483(c)(1)

      Pub. L. 98–369 struck out provision formerly set out following subpar. (B) which had directed that any rate prescribed for determining whether there was total unstated interest for purposes of subpar. (B) be at least one percentage point lower than the rate prescribed for purposes of subsec. (b)(2)

   Source evidence

   Code amendment note
   Subsec. (c)(1). Pub. L. 98–369 substituted “under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest” for “under which, using a rate provided by regulations prescribed by the Secretary for purposes of this subparagraph, there is total unstated interest”, in subpar. (B), and struck out provision formerly set out following subpar. (B) which had directed that any rate prescribed for determining whether there was total unstated interest for purposes of subpar. (B) be at least one percentage point lower than the rate prescribed for purposes of subsec. (b)(2).

   Enacted provision · exact public law section
   (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

   Effective date note
   Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

10. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    1. Substituted · 26 U.S.C. § 483(c)(2)

       Pub. L. 98–369 substituted “Treatment of other debt instruments” for “Treatment of other evidence of indebtedness” in heading and, in text

    2. Substituted · 26 U.S.C. § 483(c)(2)

       Pub. L. 98–369 substituted “a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument” for “an evidence of indebtedness of the purchaser given in consideration for the sale or exchange of property shall not be considered a payment, and any payment due under such evidence of indebtedness”

    Source evidence

    Code amendment note
    Subsec. (c)(2). Pub. L. 98–369 substituted “Treatment of other debt instruments” for “Treatment of other evidence of indebtedness” in heading and, in text, substituted “a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument” for “an evidence of indebtedness of the purchaser given in consideration for the sale or exchange of property shall not be considered a payment, and any payment due under such evidence of indebtedness”.

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

11. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    Added · 26 U.S.C. § 483(c)(3)

    Pub. L. 98–369 added par. (3)

    Source evidence

    Code amendment note
    Subsec. (c)(3). Pub. L. 98–369 added par. (3).

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

12. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    1. Amended · 26 U.S.C. § 483(d)

       Pub. L. 98–369 amended subsec. (d) generally

    2. Substituted · 26 U.S.C. § 483(d)

       Pub. L. 98–369 substituting provisions relating to exceptions and limitations for provisions which related to payments indefinite as to time, liability, or amount

    Source evidence

    Code amendment note
    Subsec. (d). Pub. L. 98–369 amended subsec. (d) generally, substituting provisions relating to exceptions and limitations for provisions which related to payments indefinite as to time, liability, or amount.

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

13. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    1. Amended · 26 U.S.C. § 483(e)

       Pub. L. 98–369 amended subsec. (e) generally

    2. Substituted · 26 U.S.C. § 483(e)

       Pub. L. 98–369 substituting provisions relating to interest rates in case of sale of principal residence or farm land for provision relating to changes in terms of contract

    Source evidence

    Code amendment note
    Subsec. (e). Pub. L. 98–369 amended subsec. (e) generally, substituting provisions relating to interest rates in case of sale of principal residence or farm land for provision relating to changes in terms of contract.

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

14. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    1. Amended · 26 U.S.C. § 483(f)

       Pub. L. 98–369 amended subsec. (f) generally

    2. Substituted · 26 U.S.C. § 483(f)

       Pub. L. 98–369 substituting provisions relating to maximum rate of interest on certain transfers of land between related parties for provisions which related to exceptions and limitations now covered in subsec. (d) of this section

    Source evidence

    Code amendment note
    Subsec. (f). Pub. L. 98–369 amended subsec. (f) generally, substituting provisions relating to maximum rate of interest on certain transfers of land between related parties for provisions which related to exceptions and limitations now covered in subsec. (d) of this section.

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

15. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    1. Amended · 26 U.S.C. § 483(g)

       Pub. L. 98–369 amended subsec. (g) generally

    2. Substituted · 26 U.S.C. § 483(g)

       Pub. L. 98–369 substituting provisions which related to calling for the promulgation of regulations by the Secretary for provisions which related to the maximum rate of interest on certain transfers of land between related parties now covered in subsec. (f) of this section

    Source evidence

    Code amendment note
    Subsec. (g). Pub. L. 98–369 amended subsec. (g) generally, substituting provisions which related to calling for the promulgation of regulations by the Secretary for provisions which related to the maximum rate of interest on certain transfers of land between related parties now covered in subsec. (f) of this section.

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

16. 1984

    Tax Reform Act of 1984

    Pub. L. 98–369 div. A title I § 41(b) · 98 Stat. 494

    Added · 26 U.S.C. § 483(h)

    Pub. L. 98–369 added subsec. (h)

    Source evidence

    Code amendment note
    Subsec. (h). Pub. L. 98–369 added subsec. (h).

    Enacted provision · exact public law section
    (b) Amendment of Section 483.— Section 483 (relating to interest 26 USC 483. on certain deferred payments) is amended to read as follows: “SEC. 483. INTEREST ON CERTAIN DEFERRED PAYMENTS. “(a) Amount Constituting Interest.— For purposes of this title, in the case of any payment— “(1) under any contract for the sale or exchange of any property, and “(2) to which this section applies, there shall be treated as interest that portion of the total unstated interest under such contract which, as determined in a manner consistent with the method of computing interest under section 1272(a), is properly allocable to such payment. “(b) Total Unstated Interest.— For purposes of this section, the term ‘total unstated interest’ means, with respect to a contract for the sale or exchange of property, an amount equal to the excess of— “(1) the sum of the payments to which this section applies which are due under the contract, over “(2) the sum of the present values of such payments and the present values of any interest payments due under the contract. For purposes of the preceding sentence, the present value of a payment shall be determined under the rules of section 1274(b)(2) Ante, p. 538. using a discount rate equal to 120 percent of the applicable Federal rate determined under section 1274(d). “(c) Payments to Which Subsection (a) Applies.— “(1) In general.— Except as provided in subsection (d), this section shall apply 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— “(A) under which some or all of the payments are due more than 1 year after the date of such sale or exchange, and “(B) under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest. “(2) Treatment of other debt instruments.— For purposes of this section, a debt instrument of the purchaser which is given in consideration for the sale or exchange of property shall not be treated as a payment, and any payment due under such debt instrument shall be treated as due under the contract for the sale or exchange. “(3) Debt instrument defined.— For purposes of this subsection, the term ‘debt instrument’ has the meaning given such Ante, p. 540. term by section 1275(a)(1). “(d) Exceptions and Limitations.— “(1) Coordination with original issue discount rules.— This section shall not apply to any debt instrument to which section 1272 applies. “(2) Sales prices of $3,000 or less.— This section shall not apply to any payment on account of the sale or exchange of property if it can be determined at the time of such sale or exchange that the sales price cannot exceed $3,000. “(3) Carrying charges.— In the case of the purchaser, the tax treatment of amounts paid on account of the sale or exchange of property shall be made without regard to this section if any such amounts are treated under section 163(b) as if they included interest. “(4) Certain sales of patents.— In the case of any transfer described in section 1235(a) (relating to sale or exchange of patents), this section shall not apply to any amount contingent on the productivity, use, or disposition of the property transferred. “(e) Interest Rates in Case of Sales of Principal Residences or Farm Lands.— “(1) In general.— In the case of any debt instrument arising from a sale or exchange to which this subsection applies, subsections (b) and (c)(1)(B) shall be applied by using, in lieu of the discount rates determined under such subsections, discount rates determined under subsections (b) and (c)(1), respectively, of this section as it was in effect before the amendments made by Ante, p. 494. the Tax Reform Act of 1984. “(2) Sales or exchanges to which subsection applies— This subsection shall apply— “(A) to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), and “(B) to any sale or exchange by a person of land used by such person as a farm (within the meaning of section 6420(c)(2)). “(3) Limitation.— Paragraph (1) shall apply to any sale or exchange by an individual of his principal residence (within the meaning of section 1034), only to the extent the purchase price of such residence does not exceed $250,000. For purposes of the preceding sentence, the purchase price of a residence shall be determined without regard to this section. “(f) Maximum Rate of Interest on Certain Transfers of Land Between Related Parties — “(1) In general.— In the case of any qualified sale, the dis-count rate used in determining the total unstated interest rate under subsection (b) shall not exceed 7 percent, compounded semiannually. “(2) Qualified sale.— For purposes of this subsection, the term ‘qualified sale’ means any sale or exchange of land by an individual to a member of such individual’s family (within the meaning of section 267(c)(4)). “(3) $500,000 limitation— Paragraph (1) shall not apply to any qualified sale between individuals made during any calendar year to the extent that the sales price for such sale (when added to the aggregate sales price for prior qualified sales between such individuals during the calendar year) exceeds $500,000. “(4) Nonresident alien individuals.— Paragraph (1) shall not apply to any sale or exchange if any party to such sale or exchange is a nonresident alien individual. “(g) Regulations.— The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section including regulations providing for the application of this section in the case of— “(1) any contract for the sale or exchange of property under which the liability for, or the amount or due date of, a payment cannot be determined at the time of the sale or exchange, or “(2) any change in the liability for, or the amount or due date of, any payment (including interest) under a contract for the sale or exchange of property. “(h) Cross Reference.— “For special rules in the case of the borrower under certain loans for personal use, see section 1275(b).” Ante, p. 540.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

17. 1985

    Pub. L. 99–121 § 101(a)(2)(A) · 99 Stat. 505

    Struck · 26 U.S.C. § 483(b)

    Pub. L. 99–121, § 101(a)(2)(A), struck out “120 percent of” after “discount rate equal to” in closing provisions

    Source evidence

    Code amendment note
    Subsec. (b). Pub. L. 99–121, § 101(a)(2)(A), struck out “120 percent of” after “discount rate equal to” in closing provisions.

    Enacted provision · exact public law section
    (A) The last sentence of section 483(b) of such Code (defining total unstated interest) is amended by striking out “120 percent of”.

18. 1985

    Pub. L. 99–121 § 101(a)(2)(B) · 99 Stat. 505

    Amended · 26 U.S.C. § 483(c)(1)(B)

    Pub. L. 99–121, § 101(a)(2)(B), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest.”

    Source evidence

    Code amendment note
    Subsec. (c)(1)(B). Pub. L. 99–121, § 101(a)(2)(B), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “under which, using a discount rate equal to 110 percent of the applicable Federal rate determined under section 1274(d), there is total unstated interest.”

    Enacted provision · exact public law section
    (B) Subparagraph (B) of section 483(c)(1) of such Code is amended to read as follows: “(B) under which there is total unstated interest.”

19. 1985

    Pub. L. 99–121 § 102(c)(1) · 99 Stat. 505

    Redesignated · 26 U.S.C. § 483(e)

    Pub. L. 99–121, § 102(c)(1), (2), redesignated subsec. (f) as (e), and as so redesignated substituted “6 percent” for “7 percent” in par. (1). Former subsec. (e), which related to the interest rates in the case of the sales of principal residences or farm lands, was struck out

    Source evidence

    Code amendment note
    Subsec. (e). Pub. L. 99–121, § 102(c)(1), (2), redesignated subsec. (f) as (e), and as so redesignated substituted “6 percent” for “7 percent” in par. (1). Former subsec. (e), which related to the interest rates in the case of the sales of principal residences or farm lands, was struck out.

    Enacted provision · exact public law section
    (1) Section 483 of such Code is amended by striking out subsection (e) and by redesignating subsections (f), (g), and (h) as subsections (e), (f), and (g), respectively.

20. 1985

    Pub. L. 99–121 § 102(c)(1) · 99 Stat. 505

    Redesignated · 26 U.S.C. § 483(f)

    Pub. L. 99–121, § 102(c)(1), redesignated subsec. (g) as (f). Former subsec. (f) redesignated (e)

    Source evidence

    Code amendment note
    Subsec. (f). Pub. L. 99–121, § 102(c)(1), redesignated subsec. (g) as (f). Former subsec. (f) redesignated (e).

    Enacted provision · exact public law section
    (1) Section 483 of such Code is amended by striking out subsection (e) and by redesignating subsections (f), (g), and (h) as subsections (e), (f), and (g), respectively.

21. 1985

    Pub. L. 99–121 § 102(c)(1) · 99 Stat. 505

    1. Redesignated · 26 U.S.C. § 483(g); 26 U.S.C. § 483(h)

       Pub. L. 99–121, § 102(c)(1), (3), redesignated subsec. (h) as (g)

    2. Amended · 26 U.S.C. § 483(g); 26 U.S.C. § 483(h)

       Pub. L. 99–121, § 102(c)(1), (3), amended it generally

    3. Amended · 26 U.S.C. § 483(g); 26 U.S.C. § 483(h)

       Pub. L. 99–121, § 102(c)(1), (3), designating existing undesignated cross reference as par. (3)

    4. Redesignated · 26 U.S.C. § 483(g); 26 U.S.C. § 483(h)

       Pub. L. 99–121, § 102(c)(1), (3), adding pars. (1) and (2). Former subsec. (g) redesignated (f)

    Source evidence

    Code amendment note
    Subsecs. (g), (h). Pub. L. 99–121, § 102(c)(1), (3), redesignated subsec. (h) as (g) and amended it generally, designating existing undesignated cross reference as par. (3), and adding pars. (1) and (2). Former subsec. (g) redesignated (f).

    Enacted provision · exact public law section
    (1) Section 483 of such Code is amended by striking out subsection (e) and by redesignating subsections (f), (g), and (h) as subsections (e), (f), and (g), respectively.

22. 1986

    Tax Reform Act of 1986

    Pub. L. 99–514 title XVIII § 1803(a)(14)(B) · 100 Stat. 2085

    Substituted · 26 U.S.C. § 483(d)(3)

    Pub. L. 99–514 substituted “for which an issue price is determined under section 1273(b) (other than paragraph (4) thereof) or section 1274” for “to which section 1272 applies”

    Source evidence

    Code amendment note
    Subsec. (d)(3). Pub. L. 99–514 substituted “for which an issue price is determined under section 1273(b) (other than paragraph (4) thereof) or section 1274” for “to which section 1272 applies”.

    Enacted provision · exact public law section
    (B) Paragraph (1) of section 483(d) is amended by striking out “any debt instrument to which section 1272 applies” and inserting in lieu thereof “any debt instrument for which an issue price is determined under section 1273(b) (other than paragraph (4) thereof) or section 1274”.

    Effective date note
    Amendment by Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.

33 of 33 references resolved to an enrolled provision