My sister is an accountant specializing in audits and forensic accounting. I've talked to her about this extensively. Any portion of the tax code that mentions "reasonableness" is indeed open to interpretation. The interpretation of this code is (much like criminal law), based on judicial rulings; case law. In the case of a "reasonable salary", the following stipulations apply:

* The IRS will not force your corporation in to an unprofitable scenario as a result of the salary requirement; i.e., if your corporation is yielding a net loss, they will not force you to take salary, but then again, your tax issue is already solved if you have a NOL

* The reasonable salary clause is targeted and applied specifically to S-corp operators who take a disproportionately large amount of their income in the form of a distribution, rather than salary

There is potential for abuse with the existing tax code, but the reasonable salary requirement was created specifically to address that. Enforcement of this clause isn't intended to be applied in the context of market salaries (which is how we usually think of them), but in the context of the ratio of salary to distributions.