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job positions he performed. Elliotts, Inc. v. Commissioner, 716
F.2d at 1246.
3. Character and Condition of Company
This factor requires us to focus on petitioner's size as
indicated by its sales, or capital value, the complexities of the
business, and the general economic conditions. Elliotts, Inc. v.
Commissioner, supra at 1246. In a relatively short time,
petitioner became a top performer in a highly competitive market.
Petitioner maintained a high gross profit ratio. Petitioner
penetrated the residential masonry market and won contracts with
some of the largest residential developers in the area.
Furthermore, petitioner survived the economic downturn that began
in 1990. Petitioner's survival was due, in part, to its
financial strength and its ability to obtain work in a declining
market. Ginger was the architect of petitioner's growth
strategy, and he provided the tools necessary to implement that
strategy. Ginger also charted petitioner's path through the
economic decline.
4. Conflict of Interest
The primary issue in considering factors indicating a
conflict of interest is whether some relationship exists between
the company and the employees which might permit the former to
disguise nondeductible corporate distributions of income as
salary expenditures deductible under section 162(a)(1). "Such a
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