- 42 -
margin after shareholder compensation was near the industry
average, and we see no compelling reason to require an above-
average return.
VII. Conclusion
A preponderance of the evidence shows that petitioner’s
shareholder-employees were reasonably compensated for each year
in issue. Therefore, petitioner may deduct in full the
compensation it paid to Darle, Dean, and Rocky for each year in
issue.
To reflect the foregoing and give effect to the parties’
concessions,
Decision will be entered
under Rule 155.
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