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have been unreasonable to conclude that petitioner wives were not
eligible for such relief. Respondent was not required to concede
this case before she received the documentation necessary to
prove petitioner wives' contentions, particularly when there were
credibility issues to be resolved. See Brice v. Commissioner,
T.C. Memo. 1990-355, affd. without published opinion 940 F.2d 667
(9th Cir. 1991). We hold that respondent's position was
substantially justified at the time the answers were filed and up
through the trial and the Court's final adjudication of the
matter.
Reasonable Costs
Section 7430 allows recovery for "reasonable litigation
costs incurred in connection with such court proceeding." Sec.
7430(a)(2). Reasonable litigation costs include:
reasonable fees paid or incurred for the services of
attorneys in connection with the court proceeding,
except that such fees shall not be in excess of $75 per
hour unless the court determines that an increase in
the cost of living or a special factor, such as the
limited availability of qualified attorneys for such
proceeding, justifies a higher rate. [Emphasis added.]
Sec. 7430(c)(1)(B)(iii). Respondent argues that petitioners have
not "paid or incurred" attorney fees because Attorney Riley's
representation was pro bono and, in the alternative, that the
requested amounts are in excess of those allowable. Based on our
findings that petitioner wives and Attorney Riley unreasonably
protracted the proceeding and that respondent's position was
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