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argues that Kleindienst could not have generated $1.2 million in
gross receipts because that would attribute too little fees to
the other escrow officers as determined by the amount of
commission they received. Kleindienst, however, did not close
escrows generating $1.2 million in fees; she solicited escrows
that generated $1.2 million in fees when closed. Kleindienst
created a continuing source of referrals by developing contacts
with realty boards, realtors, real estate developers, attorneys,
and accountants. Petitioner assigned some of the escrows that
Kleindienst solicited to other escrow officers who, in turn,
closed the escrow, generated the fee, and received the 10-percent
closing commission.
Kleindienst's efforts to solicit clients played a key role
in petitioner's success, and petitioner was substantially
dependent on her. Respondent's expert, Dave Brooks (Brooks),
admitted that Kleindienst's role in petitioner's success would
justify paying her more. Nevertheless, limits on reasonable
compensation exist even for the most valuable employee. Owensby
& Kritikos, Inc. v. Commissioner, 819 F.2d 1315, 1325 (5th Cir.
1987), affg. T.C. Memo. 1985-267; Rutter v. Commissioner, 853
F.2d 1267, 1272 (5th Cir. 1988), affg. T.C. Memo. 1986-407.
B. External Comparison
The second category of factors involves a comparison of the
employee's salary with salaries paid by similar companies for
similar services. Industry standards for compensation have been
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