Hypothetical Investor Test Used When Determining Reasonable Compensation

Business Valuation Update BVLaw
Legal and Court Case Update
June 3, 1999

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3999 Manufacturing Industries, NEC
316110 Leather and Hide Tanning and Finishing
federal taxation
Dexsil Corporation (Dexsil II) v. CIR
147 F.3d 96 (2nd Cir. 1998)
US
Federal Court
2nd Circuit
United States Court of Appeals
Walker, Jr.

Summary

The U.S. Court of Appeals for the 2nd Circuit reversed and remanded the Tax Court's decision reducing Dexsil's sec. 162 deduction because it found the CEO's compensation unreasonable.

See Also

Dexsil Corporation (Dexsil II) v. CIR

Full Text of Court Cases
June 3, 1999

The U.S. Court of Appeals for the Second Circuit reversed and remanded the Tax Court's decision reducing Dexsil's sec. 162 deduction because it found the CEO's compensation unreasonable. The Second Circuit ruled that the five step Rapco analysis applied ...