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Deckard. Thus, respondent argues, "the unnecessary use of a
professional service corporation, coupled with the specious
argument that a professional service corporation was required by
Illinois law, demonstrates an obvious attempt to structure the
transaction to avoid the provisions of section 355(a)(1)(B)".
We agree with petitioners. Mr. Pulliam's attorney and
accountants reasonably believed that it was necessary to create
Chapel as a professional service corporation, and in our judgment
their belief was well founded. It is unlawful for any person to
practice, or attempt to practice, funeral directing and embalming
in the State of Illinois without being licensed by that State.
225 Ill. Comp. Stat. 41/5-5 and 41/10-5 (West 1993). No
corporation, partnership, or association of individuals, as such,
shall be issued a license as a licensed funeral director and
embalmer. However, nothing in the Illinois Funeral Directors and
Embalmers Licensing Act restricts licensees from forming
professional service corporations under the Illinois Professional
Service Corporation Act or from having these corporations
registered for the practice of funeral directing. 225 Ill. Comp.
Stat. 41/15-50 (West 1993). Therefore, the only way to
incorporate Chapel was through a professional service
corporation. A professional corporation means a corporation
organized under the Illinois Professional Service Corporation Act
solely for the purpose of rendering one category of professional
service, and which has as its shareholders only individuals who
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