Preheat the oven to 350˚F. Grease and flour a 10-12 cup bundt pan; set aside.
In an electric mixer with a paddle attachment, cream butter and sugar until fluffy.
Add eggs 1 at a time and continue to beat well. Add the vanilla and mix well.
Add the sour cream and mix well. Add the grated apple and mix well.
Whisk together the flour, baking soda, baking powder, and salt in a mixing bowl. Add the dry ingredients to the butter mixture, stir well.
To make cinnamon walnut filling, mix the sugar, cinnamon and chopped walnut in a small mixing bowl; set aside.
In a prepared bundt pan, put half the cake batter on the bottom. Using a folk, spread the batter to even out. Sprinkle the cinnamon walnut filling on top. Put the remaining cake batter on top and even out with a folk.
Bake the cake in the preheated oven for 50-60 minutes. Let the cake rest in a pan for 10 minmutes. Invert the cake to a cooling rack and cool completely. Dust the cake with powdered sugar, if desired.