You're doing the timing wrong.
Set the points at the high point on the cam. .015.
Get a meter or test light, a 21/64” drill bit & a metal straight edge. Put the distributor face down w/ the condenser on the left & the timing plate lock screw on the bottom. Look at the end of the shaft: it has a narrow side & a wide side. Make sure you can tell the difference. Now, place the drill bit in the bottom mounting hole. (this will be your reference point for measuring) . Next, place a straight edge on the wide side of the tang on shaft as shown in fig. FO83 in the I&T FO4 manual. Rotate the shaft CCW (as viewed from rotor side OR CW as viewed from back/tang side) until the straight edge is ¼" beyond the outside edge of the drill bit you stuck in the distributor mounting hole. At this distance, the distributor points should start to open. (get your meter/light out now & check) If not, loosen the timing plate lock screw and turn to advance or retard the timing. (move the plate down to advance timing, up to retard) Remember, each one of those little hash marks represents about 4* of timing. Keep adjusting until you get the proper ¼" setting. (if the plate won’t move, you might need to remove the big C clip to loosen it a bit) As you’re adjusting, eliminate backlash by turning the shaft backwards (CW as viewed from the front) and bring the shaft forwards (CCW as viewed from the front) to measure your setting. This ¼" setting will get you static timing at top dead center.
After you set the points & timing, do a continuity check before you put the distributor back on the tractor.