The expense for compensation paid to partners does not qualify as a necessary expense for generating revenue for the professional company; rather, it is a grant and benefit given to the partner. Accordingly, it should be considered a distribution of profit and should not be classified as an allowable expense.

It is not correct to deduct the amounts of health insurance paid by the professional company on behalf of the partners as an allowable deductible expense. In reality, these amounts represent a benefit provided by the company to the partners and should be considered distribution of profits.