Which of the following factors would not be considered in determining if compensation paid to a shareholder/employee is reasonable?

Question

Quizplus · Accepted Answer

The individual's marginal income tax rate is not a relevant factor in determining if compensation paid to a shareholder/employee is reasonable. The factors to be considered include the individual's duties and responsibilities, what individuals performing in comparable capacities at other companies are paid, whether the corporation has a formal compensation policy, and other relevant factors that may affect the compensation amount. Marginal income tax rate is a personal tax factor that is not related to the reasonableness of compensation.

Which of the Following Factors Would Not Be Considered in Determining