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accordingly recomputed the corporation's taxable income by
including the $171,476 reversion in its gross income.
Both petitioner corporation and respondent now agree that
the $171,476 should have been reported as gross income by the
corporation in its 1988 return. However, the corporation does
contend that there was no resulting deficiency since its $171,476
taxable reversion income was fully offset by a deduction in the
same amount under section 162(a)(1) by reason of its contractual
obligation to Mr. Souris to pay him that $171,476 as compensation
for services rendered.
We begin our analysis of this case with a sense of
unreality. There are before us Theodore Souris, P.C., and Mr.
Souris, the individual. Mr. Souris was the sole stockholder; he
was the sole officer-employee of the corporation; he was the sole
member of its Board of Directors; and he was the sole participant
in the P.C.'s pension plan. The record contains no evidence that
anyone other than Mr. Souris held any office in, or played any
part whatsoever in, the affairs of the corporation or the plan or
served as trustee if in fact there was a trust. In this
connection, this case is sharply distinguishable from Greenlee v.
Commissioner, T.C. Memo. 1996-378, where the trustee was an
independent bank and where the transaction in question was
"independently approved" by the Trust Investment Committee of the
bank--a circumstance that the Court emphasized and considered
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