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In the current year, Madero Corporation made a $ 4 0 0 , 0 0 0 interest - free loan to Francisco Madero, the corporation

In the current year, Madero Corporation made a $400,000 interest-free loan to Francisco Madero, the corporations controlling shareholder. Mr. Madero is also the corporations chief executive officer and receives a salary of $300,000 a year. What are the tax consequences of classifying the loan as a compensation-related loan rather than as a corporation-shareholder loan?

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