Beaver Bolt, Inc. - Page 10

          as new facts came to light); Williford v. Commissioner, T.C.                
          Memo. 1994-135 (the Commissioner's valuation position was                   
          unreasonable where the Commissioner was slow to seek an                     
          appraisal, did not contact the taxpayer's valuation expert, and             
          did not modify her position after receiving the Commissioner's              
          expert's report 42 days before trial).  Respondent's position in            
          the instant case is weaker than the Commissioner's position in              
          Frisch v. Commissioner, supra, because here respondent's expert             
          substantially agreed with petitioner's expert regarding the value           
          of Grecco's stock.  We conclude that respondent's position did              
          not have a reasonable basis in fact or law.                                 
               3.   Amount of Reasonable Attorney's Fees and Litigation               
               Petitioner seeks an award of litigation costs of $44,737.25,           
          comprising $42,254.75 for attorney's fees and $2,482.50 for out-            
          of-pocket expenses.                                                         
                    a.   Hourly Rate                                                  
               Respondent argues that the maximum hourly rate for                     
          attorney's fees is $75, adjusted for increases in the cost of               
          living, sec. 7430(c)(1)(B)(iii), and that a higher limit should             
          not apply absent a showing that a special factor justifies a                
          higher rate, sec. 7430(c)(1)(B)(iii); Stieha v. Commissioner, 89            
          T.C. 784, 792 (1987).                                                       
               Petitioner does not argue that special factors are present             
          that warrant payment of attorney's fees at a rate higher than               

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