Interest taxation for sale and buy-back transactions treats accrued interest as taxable income despite transfer of securities.

The provision treats interest accruing on a security owned by another person as part of the taxpayer's total income where the taxpayer undertakes a sale and buy-back transaction, the interest accrues to the other person as a result of that transaction, and the income would have been includible in the taxpayer's total income had the transfer not occurred.

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