Time Inc. yesterday closed the deal to buy the Washington Star by paying Publisher Joe L. Allbritton $20 million and assuming the newspaper's debts of about $8 million.

Time Inc. President James R. Shepley will become chairman of the Star's board of directors, and Allbritton will remain publisher under a five-year contract, a company spokesman said.

No details of Time's plans for the Star were announced yesterday by Time, which had agreed on Feb. 3 to buy the paper.

Sale of the Star was the latest in a series of divestitures which Allbritton has acknowledged will enable him to more than double the $65 million he has invested in Washington Star Communications Inc.

Allbritton is awaiting an appeals courts ruling on the Federal Communications Commission's decision allowing him to trade WJLA-TV to Combined Communications Inc. in exchange for an Aklahoma City television station (estimated to be worth $25 million to $30 million) and Combined stock worth $55 million.

Because Allbritton had said the WJLA trade was needed to assure the survival of the Star, the FCC reviewed its decision last week and again authorized the sale. When Allbritton acquired Washington Star Communication Icn., the FCC required him to sell the company's Washington broadcasting stations under a policy of discouraging joint ownership of newspaper and broadcast operations in the same market.

In September 1976, Allbritton sold WMAL-AM and WMAL-FM (now WROO) to the American Broadcasting Co. for $16 million. Last April, he sold WLVA-FM in Lynchburg to Shenandoah Broadcasting for $600,000.