- 14 -
Williamson v. Commissioner, T.C. Memo. 1997-77 (quoting Nalle v.
Commissioner, 55 F.3d 189, 191 (5th Cir. 1995), affg. T.C. Memo.
1994-182).
Whether respondent's position was substantially justified
turns on a finding of reasonableness, based upon all the facts
and circumstances, as well as the legal precedents relating to
the case. Pierce v. Underwood, 487 U.S. 552 (1988); Nalle v.
Commissioner, supra; Coastal Petroleum Refiners, Inc. v.
Commissioner, 94 T.C. 685, 688-696 (1990). A position is
substantially justified if that position could satisfy a
reasonable person. Pierce v. Underwood, supra at 565; Powers v.
Commissioner, 100 T.C. 457, 473 (1993), affd. on this issue,
revd. in part, and remanded on other issues 43 F.3d 172 (5th Cir.
1995). Respondent's position may be incorrect but substantially
justified "if a reasonable person could think it correct".
Pierce v. Underwood, supra at 566 n.2.
The reasonableness standard applies to motions for
litigation and administrative costs under section 7430.
Nicholson v. Commissioner, 60 F.3d 1020, 1025-1026 (3d Cir.
1995), revg. T.C. Memo. 1994-280. For a position to be
substantially justified, there must be "substantial evidence" to
support it. Pierce v. Underwood, supra at 564-565; Maggie
Management Co. v. Commissioner, 108 T.C. 430, 443 (1997); Powers
v. Commissioner, supra. "That phrase does not mean a large or
considerable amount of evidence, but rather 'such relevant
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