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whose contribution to petitioner’s profit we cannot assume to be
zero.
Petitioner does not prevail, as a matter of law, based on
Bianchi v. Commissioner, supra.
b. Richlands Med. Association v. Commissioner
Petitioner refers us to one of our memorandum opinions,
Richlands Med. Association v. Commissioner, T.C. Memo. 1990-660,
affd. without published opinion 953 F.2d 639 (4th Cir. 1992), for
the following proposition: Specifically, the Tax Court held
“petitioner’s associates were entitled to receive, as
compensation for their services to patients, 100 percent of the
collections recorded by petitioner as attributable to such
services.” In Richlands Med. Association, we did so find. We
did that, however, after finding that respondent, in his notice
of deficiency, had allowed such amounts as a deduction for
compensation.
In Richlands Med. Association, the taxpayer not only
provided physician’s services but also owned a hospital that
provided medical services ancillary to physician’s services.
With respect to the taxpayer’s system of compensation, under
which all funds left after the payment of expenses and the
establishment of reserves were distributed to its associates
(owner employees), we observed that the taxpayer’s expert, an
accountant, was unable to explain how the taxpayer could ever
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