- 5 -
$100 of merchandise monthly, the initiator of the group will
receive commission based on monthly sales of $7,900, subject to
commission-sharing adjustments. Mr. Landrum estimated that the
person who established a successful 6-4-2 grouping would receive
$1,800 to $2,200 in monthly commissions and then might proceed to
gain even greater benefits as a “direct distributor” who might
then triple his organization and receive an “Emerald bonus” and
then expand to have six legs and a “Diamond organization”.
According to Mr. Landrum, Amway distributors with an emerald
organization make $75,000 to $100,000 annually, and those with a
diamond organization make $125,000 to $250,000 yearly, “And it
goes up from there” as he put it.1
Petitioners had no such experience during the years in issue
and all the earlier years of their participation in Amway
distributorships. There simply is no resemblance between the
wonderfully optimistic projection that Mr. Landrum recited and
the reality of petitioners’ experience during their many years of
association with Amway.
1 See Nissley v. Commissioner, T.C. Memo. 2000-178, for this
Court’s recent summary of Amway operations with somewhat more
detail and less fantasy, at least as to himself, than Mr. Landrum
provided.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011