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to do a good job.” On cross-examination, Mr. Dobbe testified
that he regularly paid Mr. Heemskerk a commission for his efforts
in purchasing bulbs for Holland America. When Mr. Dobbe was
asked whether the golf clubs were related to a particular
purchase, he responded:
They–-I knew he loved the game of golf in whatever free
time he had, and it would be a tremendous treat to
receive a set of clubs from the United States, and for
his service and for his unbelievable importance to our
business, I felt it was an incredible incentive for
what he up to that point meant for our business and
what he hopefully was going to continue to mean for our
business.
We conclude that Holland America purchased the golf clubs
for Mr. Heemskerk as an incentive for future performance and in
appreciation for his past services to the company. Thus, Holland
America did not give the golf clubs to Mr. Heemskerk out of a
“detached and disinterested generosity”; rather, Holland America
anticipated receiving an economic benefit in the future. See
Commissioner v. Duberstein, supra at 285; Olk v. United States,
supra at 877-878.
Accordingly, we hold that the golf clubs were not a “gift”
within the meaning of section 274(b). We further hold that
Holland America has met its burden of establishing that the cost
of the golf clubs was an ordinary and necessary business expense
deductible under section 162(a).
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