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Petitioner contends that this language from its resolutions means
nothing because it used the identical language for many years as
boilerplate. We do not believe that the board of directors took
the decisions to pay the bonuses and the resolutions approving
them as lightly as petitioner suggests.
We conclude that petitioner paid the compensation at issue
for services performed by its officers for petitioner.
2. Whether the Compensation Was Reasonable in Amount
Whether the amount of compensation is reasonable is a
question of fact. Botany Worsted Mills v. United States, 278
U.S. 282, 289-290 (1929); Estate of Wallace v. Commissioner, 95
T.C. 525, 553 (1990), affd. 965 F.2d 1038 (11th Cir. 1992).
Factors to consider in deciding whether compensation is
reasonable include (a) the employee's qualifications; (b) the
nature, extent, and scope of the employee's work; (c) the size
and complexity of the business; (d) a comparison of salaries paid
with sales, net income, gross income, and capital value; (e)
general economic conditions; (f) the taxpayer's salary policy to
all employees; (g) the taxpayer's financial condition; (h)
prevailing rates of compensation for comparable positions in
comparable companies; (i) compensation paid in prior years; and
(j) whether the employee and the taxpayer dealt at arm's length.
Elliotts, Inc. v. Commissioner, supra at 1245-1248; Kennedy v.
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