Galedrige Construction, Inc. - Page 8

          sanctions for frivolousness will not satisfy this standard;                 
          rather, it must have a "reasonable basis both in law and fact."             
          Pierce v. Underwood, supra at 564-565.  A position is not                   
          substantially justified in law if legal precedent does not                  
          substantially support the Commissioner's position given the facts           
          available to the Commissioner.  Coastal Petroleum Refiners, Inc.            
          v. Commissioner, supra at 688.  The Commissioner cannot escape an           
          award for costs pursuant to section 7430 simply because a case              
          presents a question of fact.  Minahan v. Commissioner, 88 T.C.              
          492, 500-502 (1987).                                                        
               The fact that the Commissioner eventually loses or concedes            
          the case is not determinative as to whether the taxpayer is                 
          entitled to an award of administrative or litigation costs.                 
          Sokol v. Commissioner, 92 T.C. 760, 767 (1989); Wasie v.                    
          Commissioner, 86 T.C. 962, 968-969 (1986).  It remains, however,            
          a relevant factor to consider in determining the degree of the              
          Commissioner's justification.  Estate of Perry v. Commissioner,             
          931 F.2d 1044, 1046 (5th Cir. 1991); Powers v. Commissioner,                
          supra at 470, 472.                                                          
               Petitioner has the burden of establishing that respondent's            
          position was not substantially justified.  Rule 232(e); Dixson              
          Intl. Serv. Corp. v. Commissioner, 94 T.C. 708, 715 (1990).  For            
          petitioner to prevail, it must show that respondent's position,             
          in fact as well as in law, was not justified to a degree that               
          could satisfy a reasonable person.  Determining the                         

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