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the same amounts were paid as bonuses to Louise and Emile. As to
both Emile and Louise, we answer the question in the negative.
j. Absence of Pension Plan/Profit-Sharing Plan
We analyze whether petitioner had a pension plan or
profit-sharing plan. The absence of a pension plan or profit-
sharing plan may allow an employer to pay an employee more
compensation than the employer would have paid had the employer
offered the employee either of those plans. Rutter v.
Commissioner, 853 F.2d 1267, 1274 (5th Cir. 1988), affg. T.C.
Memo. 1986-407.
Petitioner had a pension plan, but we do not know who its
participants were. As to both Emile and Louise, we are unable to
answer the question affirmatively.
k. Conclusion
We conclude that the bonuses paid to Emile and Louise in the
subject years were unreasonable in that they were not actually
paid for personal services rendered. Accordingly, we sustain
respondent’s determination as to this issue.
2. Accumulated Earnings Tax
We turn next to the applicability of the accumulated
earnings tax. Respondent determined that the tax applies to each
year in issue. Petitioner contends that the tax applies to none
of those years. Petitioner asserts that it accumulated earnings
during those years to redeem the disputed shares. Petitioner
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