- 7 - the Commissioner's position and conduct requires considering what the Commissioner knew at the time. See Rutana v. Commissioner, 88 T.C. 1329, 1334 (1987); DeVenney v. Commissioner, 85 T.C. 927, 930 (1985). The fact that the Commissioner loses on the merits or concedes the case does not establish that a position was not substantially justified; however, it is a factor to be considered. Powers v. Commissioner, 100 T.C. 457, 471 (1993). The Court has adopted an issue-by-issue approach to section 7430, apportioning the requested awards between those issues for which the Commissioner was and those issues for which the Commissioner was not substantially justified. See Powers v. Commissioner, 51 F.3d 34, 35 (5th Cir. 1995); Swanson v. Commissioner, supra at 102; see also sec. 301.7430-5(c)(2), Proced. & Admin. Regs. We follow that approach here and separately discuss whether respondent's position on the classification issue, pension issue, and self-employment tax issue was not substantially justified. 1. Classification Issue This Court, in Mosteirin II, ruled that the Commissioner was substantially justified in litigating the employee versus independent contractor issue in a case involving NOA's of Allstate even though the Commissioner had unsuccessfully taken the identical position in this Court twice before. We noted that the motion for costs presented a close case and that our opinionPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011