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petitioner bears the burden of proving the reasonableness of the
compensation. Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115
(1933). If petitioner proves respondent's determination to be
wrong, the Court must then decide the amount of compensation that
was reasonable. Pepsi-Cola Bottling Co. v. Commissioner, 61 T.C.
564, 568 (1974), affd. 528 F.2d 176 (10th Cir. 1975).
In addressing the reasonableness of compensation, the Court
of Appeals for the Sixth Circuit, the court to which an appeal in
this case lies, has adopted a set of basic factors that should be
considered by the Court in reaching its decision: (1) The
employee's qualifications; (2) the nature, extent, and scope of
the employee's work; (3) the size and complexities of the
employer's business; (4) a comparison of salaries paid with the
employer's gross and net income; (5) the prevailing general
economic conditions; (6) a comparison of salaries paid with
distributions of retained earnings; (7) the prevailing rates of
compensation for comparable positions in comparable concerns; (8)
the salary policy of the employer as to all employees; and (9) in
the case of small corporations with a limited number of officers,
the amount of compensation paid to the particular employee in
previous years. Mayson Manufacturing Co. v. Commissioner, supra;
see also Home Interiors & Gifts, Inc. v. Commissioner, 73 T.C.
1142, 1155-1156 (1980). The situation must be considered as a
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