18 The substantially justified standard requires that the Government's position have a reasonable basis in both law and fact. Pierce v. Underwood, supra at 563-564. We need not decide whether respondent had a basis in law because respondent did not have a basis in fact. Thus, we hold that respondent's position was not substantially justified when respondent sent the notice of deficiency and filed the answer, and that petitioner is entitled to an award under section 7430 for its reasonable administrative and litigation costs. D. Reasonable Administrative and Litigation Costs Petitioner seeks an award for its attorney's fees of $40,980, miscellaneous costs of $144.48, and accountant's fees of $2,462.50. We must decide whether the number of hours billed, the rate at which those hours were billed, and the miscellaneous costs are reasonable as claimed by petitioner. 1. Applicable Hourly Rate for Attorney's Fees Petitioner's attorney, William Shannahan (Shannahan), billed at an hourly rate of $300 for his work in this case. Respondent objects to our basing an award for litigation costs on Shannahan's rate to the extent it exceeds $110. Section 7430(c)(1)(B)(iii) limits the hourly rate for attorney's fees to $110, increased by the cost of living and other special factors. The cost of living increase is rounded to the nearest multiple of $10. Sec. 7430(c)(1). The allowable feePage: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
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