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Petitioners argue that they are entitled to a higher than
statutory rate for the hours their attorney billed because their
attorney has practiced in the tax controversy arena for over 30
years and their case involved intricate tax matters. Respondent
counters that tax expertise does not qualify as a special factor
which would allow the Court to award fees at an increased rate.
Respondent further argues that the travel costs incurred by
petitioners' attorney were unnecessary and that a rate of $65 per
hour for a paralegal is excessive because it is "substantially
close" to the statutory rate allowable for attorneys.
A. Special Factor
To preserve the intended effectiveness of the $75 cap, any
"special factor" should not be of broad and general application.
Pierce v. Underwood, 487 U.S. at 573; Powers v. Commissioner, 100
T.C. at 489.
In order for the "limited availability of qualified
attorneys" to constitute a special factor warranting departure
from the $75 cap, there must be a limited availability of
attorneys who possess distinctive knowledge or a specialized
skill needful to the particular litigation in question, as
opposed to an extraordinary level of general lawyerly knowledge
and ability useful in all litigation. Pierce v. Underwood, supra
at 572; Cozean v. Commissioner, 109 T.C. ___ (1997). Factors
such as the novelty and difficulty of the issues, the
undesirability of the case, the work and ability of counsel, the
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