John Bowden, Inc. - Page 12

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          In some instances, an unexplained alternative and theoretically             
          inconsistent position could be totally misleading and cause an              
          unsophisticated taxpayer to spend needless time and effort trying           
          to comprehend the Government's position.  This case, however,               
          does not present such a problem.                                            
               The issue of the Bowdens' gain from the section 351                    
          transaction and the corresponding section 362 adjustments was the           
          subject of much correspondence and discussion between respondent            
          and petitioner.  The Government's position was also outlined in             
          the revenue agent's report disclosed to petitioner on                       
          September 5, 1995.  The record reflects that the petitioner was             
          familiar with the issues as well as with the Government's                   
          position on these issues from early on in the proceeding.                   
          Accordingly, we find that petitioner has not established that               
          respondent's position was not substantially justified.                      
               Because petitioner has not proven that respondent's position           
          was not substantially justified, we need not decide whether                 
          petitioner's litigation costs are reasonable and whether                    
          petitioner unreasonably protracted the court proceedings.                   
          Petitioner's motion for litigation costs will be denied.                    
               To reflect the foregoing,                                              
                                                  An appropriate Order                
                                             and Decision will be entered.            

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