                 FOR PUBLICATION
 UNITED STATES COURT OF APPEALS
      FOR THE NINTH CIRCUIT

STANLEY T. JOHNSON; CONSTANCE         
JOHNSON,
                                           No. 04-72322
            Petitioners-Appellants,
                v.                         Tax Ct. No.
                                             7415-02
COMMISSIONER OF INTERNAL
                                             OPINION
REVENUE,
             Respondent-Appellee.
                                      
              Appeal from a Decision of the
                United States Tax Court

                  Argued and Submitted
       February 15, 2006—San Francisco, California

                   Filed March 28, 2006

      Before: Procter Hug, Jr., Arthur L. Alarcón, and
          M. Margaret McKeown, Circuit Judges.

                 Opinion by Judge Alarcón




                           3381
3384                    JOHNSON v. CIR


                         COUNSEL

Heidi Parry Stern, Beckley Singleton, Chtd., Las Vegas,
Nevada, for the petitioners-appellants.

John Schumann, United States Department of Justice, Tax
Division, Washington, DC, for the respondent-appellee.


                         OPINION

ALARCÓN, Circuit Judge:

   Stanley T. Johnson and his present wife, Constance John-
son (“Appellants”), appeal from the United States Tax Court’s
decision that there is a deficiency in income tax due from
them for the taxable year 1997. The court has jurisdiction pur-
suant to 26 U.S.C. § 7482. The gravamen of Appellants’ argu-
ment is that Internal Revenue Code (“I.R.C.”) § 71, as
amended in 1984 (“new § 71” or the “new law”), should
apply to Mr. Johnson’s deduction for alimony in the 1997 tax
year, rather than the version of I.R.C. § 71 that existed prior
to the amendment (“old § 71” or the “old law”). We disagree
and affirm the decision of the Tax Court.

                               I

   Stanley Johnson was formerly married to Joyce J. Johnson
(“Joyce”). Joyce was issued a decree of divorce on May 14,
1976. Mr. Johnson was required to pay alimony to Joyce in
amounts ranging from $1,250 per month at the outset to
                             JOHNSON v. CIR                             3385
$2,400 per month. On March 16, 1993, Mr. Johnson filed a
Motion To Modify The Terms of the Divorce and Terminate
Alimony Payments in the Family Division of the Clark
County Nevada District Court. Joyce responded by filing a
Countermotion to Increase Alimony Payments. On April 14,
1997, the district court released its Findings of Fact and Con-
clusions of Law. Mr. Johnson then filed a Notice of Appeal
to the Supreme Court of the State of Nevada and was granted
his Application for Stay Re: Increase in Alimony.

   Prior to oral argument in the Supreme Court of Nevada,
Mr. Johnson and Joyce entered into a Settlement and Release
Agreement (“the 1997 Agreement”). It provided that (1)
Joyce would dismiss with prejudice her counterclaim to
increase alimony payments, (2) the Nevada District Court
would not retain jurisdiction over any further claims in the case,1
and (3) Mr. Johnson would pay $400,000 in one lump-sum no
later than Thursday, July 10, 1997. The 1997 Agreement
specified that the payment “shall be Stanley’s final alimony
payment to Joyce and constitute total and complete liquida-
tion and discharge of all debts Stanley owes to Joyce.” The
agreement makes no reference to I.R.C. § 71. On July 15,
1997, after Mr. Johnson made the payment pursuant to the
1997 Agreement, Joyce’s Countermotion was dismissed with
prejudice by the Family Division of the District Court for
Clark County, Nevada. The dismissal order also stated that
Mr. Johnson had “discharged any and all obligations to pay
Joyce alimony” by the terms of the 1997 Agreement.

   On their tax return for the 1997 tax year, Appellants
claimed a deduction for their alimony payments from their
income in the amount of $424,000. The Commissioner disal-
lowed $400,000 of that deduction, and issued a notice of defi-
ciency determination. Appellants filed a petition in the Tax
Court seeking a redetermination of the deficiency. In response
  1
   We express no opinion as to the validity of the clause specifying that
the family court is to be deprived of any further jurisdiction over this case.
3386                        JOHNSON v. CIR
to the parties’ cross-motions for summary judgment, the Tax
Court granted partial summary judgment in favor of the Appel-
lee.2 The Tax Court determined that “new section 71 is appli-
cable only to divorce instruments executed after December
31, 1984, or modified after December 31, 1984, where the
modified instrument states that the amended version of sec-
tion 71 will apply.” Johnson v. Commissioner, No. 7415-02,
slip. op. at 5 (quoting Marten v. Commissioner, 78 T.C.M
(CCH) 584, 585 (1999), aff’d sub nom. Commissioner v.
Lane, 40 Fed. Appx. 385 (9th Cir. 2002)). The Tax Court
found “the 1997 Agreement, taken together with the stipula-
tion and dismissal order, constituted a modification of the
divorce decree.” Id. Accordingly, the Tax Court held that the
law applicable to divorce instruments executed before
December 31, 1984 applies to the instant case. Id. In its final
decision—the Tax Court held that there is a deficiency in tax
due from Appellants in the amount of $153,167. The Tax
Court’s conclusions of law, including construction of the tax
code, are reviewed de novo. Frontier Chevrolet Co. v. Com-
missioner, 329 F.3d 1131, 1134 (9th Cir. 2003).

                                   II

   [1] Payments are deductible as “alimony” pursuant to
I.R.C. § 215(a). The term “alimony” is defined under I.R.C.
§ 71. The pertinent part of § 71(b)(1) provides:

      (1) In general. The term “alimony or separate
      maintenance payment” means any payment in cash
      if—

      (A) such payment is received by (or on behalf of)
      a spouse under a divorce or separation instrument,
  2
    The Tax Court found a triable issue of material fact remained “as to
what portion, if any, of the $400,000 alimony paid constitutes arrearage.”
Id. The parties entered into a stipulation providing that $13,750 of the
$400,000 payment is deductible as “arrearages” for past due alimony.
                               JOHNSON v. CIR                            3387
       (B) the divorce or separation instrument does not
       designate such payment as a payment which is not
       includible in gross income under this section and not
       allowable as a deduction under section 215.

       (C) in the case of an individual legally separated
       from his spouse under a decree of divorce or of sepa-
       rate maintenance, the payee spouse and the payor
       spouse are not members of the same household at the
       time such payment is made, and

       (D) there is no liability to make any such payment
       for any period after the death of the payee spouse
       and there is no liability to make any payment (in
       cash or property) as a substitute for such payments
       after the death of the payee spouse.

Section 71 was amended by Congress in 1984 as part of the
Deficit Reduction Act (DEFRA). The old § 71 provides that
payments are only deductible if they are made periodically.
I.R.C. of 1954 § 71(a)(1) (current version at 26 U.S.C. § 71
(2006)).3 However, the language requiring that payments be
periodic in order to be deductible is absent in new § 71. I.R.C.
§ 71. Accordingly, if the old law applies, the $400,000 pay-
ment to Joyce is not deductible. It would be deductible under
the new law.
  3
   The old law states:
      If a wife is divorced or legally separated from her husband under
      a decree of divorce or separate maintenance, the wife’s gross
      income includes periodic payments (whether or not made at regu-
      lar intervals) received after such decree in discharge of (or attrib-
      utable to property transferred, in trust or otherwise, in discharge
      of) a legal obligation which, because of the marital or family rela-
      tionship, is imposed on or incurred by the husband under the
      decree or under a written instrument incident to such divorce or
      separation.
I.R.C. of 1954 § 71(a)(1) (current version at 26 U.S.C. § 71 (2006))
(emphasis added).
3388                     JOHNSON v. CIR
  Appellants argue that the new § 71 applies because the
1997 Agreement is a divorce or separation instrument accord-
ing to § 71(b)(2)(A). Pursuant to § 71(b)(2), the term “divorce
or separation instruments” is defined as:

    (A) a decree of divorce or separate maintenance or
    a written instrument incident to such a decree,

    (B)    a written separation agreement, or

    (C) a decree (not described in subparagraph (A))
    requiring a spouse to make payments for the support
    or maintenance of the other spouse.

However, Appellants’ argument is not persuasive because the
most important question before the court is not whether the
1997 Agreement, standing alone, satisfies the requirements of
the new law. Rather, the Court must determine whether the
1997 Agreement is merely a modification of the 1976 divorce
decree, or a separate stand alone instrument of divorce.

   [2] This case turns on the relationship between I.R.C. § 71,
and § 422(e) of DEFRA. Section 422(e) of DEFRA defines
the date on which the new law became effective, and provides
guidance as to whether the new law applies to instruments of
divorce created prior to the effective date of the legislation. It
provides inter alia:

    (1) In general. Except as otherwise provided in this
    subsection, the amendments made by this section
    [amending 26 U.S.C. §§ 71, 215, 219, 682, 6676,
    and 7701] shall apply with respect to divorce or sep-
    aration instruments (as defined in section 71(b)(2) of
    the Internal Revenue Code of 1954 [1986], as
    amended by this section) executed after December
    31, 1984.

    (2) Modifications of instruments executed before
    January 1, 1985. The amendments made by this sec-
                             JOHNSON v. CIR                           3389
      tion shall also apply to any divorce or separation
      instrument (as so defined) executed before January
      1, 1985, but modified on or after such date if the
      modification expressly provides that the amendments
      made by this section shall apply to such modifica-
      tion.

DEFRA, § 422(e), Pub. L. 98-369, 98 Stat. 494, 798 (empha-
sis added).

   Relying on the language of § 422(e)(2), the Commissioner
argues that the Tax Court was correct in determining that the
old law applies. The parties agree that new § 71 would apply
by its own terms if the 1997 Agreement is construed to be a
new written instrument “incident to a divorce,” and not a fur-
ther modification of the original 1976 decree, because the rule
expressed in § 422(e)(1) of DEFRA would then govern. If,
however, the 1997 Agreement is merely a modification of the
1976 divorce decree, as the Commissioner contends, the old
law governs. DEFRA, § 422(e)(2), 98 Stat. at 798.

   Appellants maintain the first paragraph of DEFRA,
§ 422(e) is independent of the second paragraph. They argue
that the first paragraph of the statute controls this case and it
is unnecessary to look at the second paragraph. However,
Appellants argument is not persuasive because the first part of
the statute begins with the phrase “except as otherwise pro-
vided in this subsection.” DEFRA, § 422(e), Pub. L. 98-369,
98 Stat. at 798. This language indicates that the first and sec-
ond paragraph of the statute should be read together.

   Appellants also contend any instrument, including the 1997
Agreement, that materially alters the timing or amount of ali-
mony payments is a new stand-alone instrument of divorce
and not therefore subject to the second paragraph of DEFRA
§ 422(e). They cite Treasury Regulation § 1.71-1T4 to support
  4
   The regulation is set forth in the form of questions and answers. It pro-
vides in pertinent part:
3390                        JOHNSON v. CIR
that contention. This Court will normally “defer to an agen-
cy’s construction of a statute it administers” provided that its
interpretation is not contrary to congressional intent. Miller v.

    Q-26 When does section 71, as amended by the Tax Reform
    Act of 1984, become effective?
    A-26 Generally, section 71, as amended, is effective with
    respect to divorce or separation instruments (as defined in section
    71(b)(2)) executed after December 31, 1984. If a decree of
    divorce or separate maintenance executed after December 31,
    1984, incorporates or adopts without change the terms of the ali-
    mony or separate maintenance payments under a divorce or sepa-
    ration instrument executed before January 1, 1985, such decree
    will be treated as executed before January 1, 1985. A change in
    the amount of alimony or separate maintenance payments or the
    time period over which such payments are to continue, or the
    addition or deletion of any contingencies or conditions relating to
    such payments is a change in the terms of the alimony or separate
    maintenance payments. For example, in November 1984, A and
    B executed a written separation agreement. In February 1985, a
    decree of divorce is entered in substitution for the written separa-
    tion agreement. The decree of divorce does not change the terms
    of the alimony A pays to B. The decree of divorce will be treated
    as executed before January 1, 1985 and hence alimony payments
    under the decree will be subject to the rules of section 71 prior
    to amendment by the Tax Reform Act of 1984. If the amount or
    time period of the alimony or separate maintenance payments are
    not specified in the pre-1985 separation agreement or if the
    decree of divorce changes the amount or term of such payments,
    the decree of divorce will not be treated as executed before Janu-
    ary 1, 1985, and alimony payments under the decree will be sub-
    ject to the rules of section 71, as amended by the Tax Reform Act
    of 1984. Section 71, as amended, also applies to any divorce or
    separation instrument executed (or treated as executed) before
    January 1, 1985 that has been modified on or after January 1,
    1985, if such modification expressly provides that section 71, as
    amended by the Tax Reform Act of 1984, shall apply to the
    instrument as modified. In this case, section 71, as amended, is
    effective with respect to payments made after the date the instru-
    ment is modified.
Treas. Reg. § 1.71-1T, Q. & A. 26.
                        JOHNSON v. CIR                      3391
Commissioner, 310 F.3d 640, 644 (9th Cir. 2002) (quoting
Cornejo-Barreto v. Seifert, 218 F.3d 1004, 1014 (9th Cir.
2000)). The Tax Court was correct in determining that the
cited regulation is inapposite pursuant to Tax Decision 7973,
which states:

    These temporary regulations are presented in the
    form of questions and answers. The questions and
    answers are not intended to address comprehensively
    the issues raised by sections 1041, 71, 215 and
    152(e). Taxpayers may rely for guidance on these
    questions and answers, which the Internal Revenue
    Service will follow in resolving issues arising under
    sections 1041, 71, 215 and 152(e). No inference,
    however, should be drawn regarding questions not
    expressly raised and answered.

T.D. 7973, 1984; 49 Fed. Reg. 34451. The cited regulation
applies only to the narrow example given therein—a pre-
amendment separation agreement that is substituted by a post-
amendment divorce decree that makes no substantive changes
to the agreement. Treas. Reg. § 1.71-1T, Q. & A. 26.

   Appellants also argue that any post-1984 instrument of
divorce that materially alters the timing or amount of alimony
payments is automatically governed by the new law by opera-
tion of § 422(e)(1). They contend it was not necessary to pro-
vide in the 1997 Agreement that the new law applies pursuant
to § 422(e)(2). It follows from Appellants’ interpretation that
the second part of the statute, DEFRA § 422(e)(2), applies to
instruments that do not materially alter the terms of the ali-
mony payments defined by pre-1984 instruments. If this court
were to accept Appellants’ construction of the statute, the sec-
ond part of the statute would have no effect, as it would apply
only where a new instrument left the terms of the previous
instrument unchanged. “[W]e are hesitant to adopt an inter-
pretation of a congressional enactment which renders super-
fluous another portion of that same law.” Kawaauhau v.
3392                    JOHNSON v. CIR
Geiger, 523 U.S. 57, 62 (1998) (quoting Mackey v. Lanier
Collection Agency & Service, Inc., 486 U.S. 825, 837 (1988)).
Appellants have failed to persuade us that Congress would
enact a statute governing the deduction of alimony payments
that would only apply in cases where the parties drafted a
document that has no material impact on the timing or amount
of alimony payments.

   [3] A more sensible reading of § 422(e)(2) would allow the
parties to negotiate the allocation of tax liability for any
agreement that materially alters the timing or amount of ali-
mony payments. Contrary to Appellants’ suggestion, it seems
likely that the term “[m]odifications of instruments executed
before January 1, 1985” in § 422(e)(2) refers to modifications
of pre 1985 instruments by post-1985 instruments that govern
the amount and timing of alimony payments.

   Nevertheless, Appellants would still prevail in the instant
case if the 1997 Agreement could be construed as a new
stand-alone instrument of divorce as opposed to a modifica-
tion of the 1976 divorce decree. However, there was only one
divorce decree in the instant case and it was modified several
times. In their response to the Commissioner’s requests for
admissions, Appellants state “[p]ursuant to a number of court
orders, commencing August 3, 1976, and continuing through
June 27, 1997, petitioner paid alimony to Joyce Johnson in
amounts ranging from $1,250 per month at the outset to
$2,400 per month.” Moreover, the motion filed by Appellants
that gave rise to the instant litigation was styled a “Motion to
Modify Decree of Divorce and to Modify or Terminate Ali-
mony Payments.” Joyce filed a “Countermotion to Increase
Alimony.” The 1997 Agreement therefore stems from a con-
troversy over the proposed modification of alimony provi-
sions of the 1976 divorce decree.

   [4] The Settlement and Release Agreement provides that
the payment was made in contemplation of Mr. Johnson’s
Motion and Joyce’s Countermotion to alter the alimony terms
                        JOHNSON v. CIR                    3393
of the 1976 decree. The final Stipulation and Order for Dis-
missal entered by the district court also provides that Joyce
agrees to dismiss her Countermotion for an increase in her ali-
mony payments. It further provides that “Stanley have no fur-
ther remaining obligation to pay Joyce any additional
alimony, support or other sums whatsoever, Stanley having
fully discharged [his obligations under the separate Settlement
and Release Agreement].” It follows that the 1997 Agree-
ment, and the $400,000 payment, settled a dispute over the
modification of the alimony provisions of the 1976 divorce
decree. It was not a separate stand-alone agreement. Rather,
it was a modification of a divorce decree created prior to
1984. Because it was a modification of a pre-1984 divorce
decree, the parties needed to specify in their agreement that
the new law applies pursuant to DEFRA § 422(e)(2) if Appel-
lants wanted the benefit of the deduction for alimony paid to
Joyce. DEFRA, § 422(e), Pub. L. 98-369, 98 Stat. 494, 798.
They did not do so. Accordingly, the Tax Court correctly
determined that Appellants are not entitled to deduct the lump
sum alimony payment.

                              III

   [5] We also conclude that there is no merit to Appellants’
secondary argument that a portion of the $400,000 payment
is deductible pursuant to old § 71(c)(2). The old law states:
“installment payments discharging a part of an obligation the
principal sum of which is, either in terms of money or prop-
erty, specified in the decree, instrument, or agreement shall
not be treated as periodic payments.” I.R.C. of 1954
§ 71(c)(1) (current version at 26 U.S.C. § 71 (2006)). Only
periodic payments are deductible under the old law. I.R.C. of
1954 §§ 71, 215 (current version at 26 U.S.C. §§ 71, 215
(2006)). Subsection (c)(2) of the old law provides an
exception—that installment payments may be treated as peri-
odic payments provided that the principal “is to be paid or
may be paid over a period ending more than 10 years from the
date of such decree, instrument or agreement.” I.R.C. of 1954
3394                    JOHNSON v. CIR
§ 71(c)(2) (current version at 26 U.S.C. § 71 (2006)). In such
case, ten percent of the principal could be deducted in any one
year. Id.

   [6] Appellants argue that the lump-sum settlement payment
of $400,000 should be construed as a single installment in a
set of installments that lasted more than ten years because Mr.
Johnson has been making payments to Joyce since 1976. But
a lump-sum final payment and a periodic payment are mutu-
ally exclusive concepts, and appear to be treated as such
under old § 71(c)(1). In Lounsbury v. Commissioner, 321 F.2d
925 (9th Cir. 1963), this court rejected a similar argument. Id.
at 926. We held in Lounsbury that “lump sum payments are
not deductible as periodic payments.” Id. at 927.

   [7] Moreover, it is unclear how old § 71(c) could possibly
apply because the exception to the old law is based on the
premise that the installments discharge a principal sum
defined in an instrument of divorce. I.R.C. of 1954 § 71(c)
(current version at 26 U.S.C. § 71 (2006)); see also Revenue
Rule 78-415. However, no agreement in the instant case pro-
vided for a principal sum to be paid in installments. Because
the 1976 divorce decree never specified a principal sum of ali-
mony, Appellants’ reliance on the old law, and Revenue Rule
78-415, is misplaced.

  AFFIRMED.
