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All section references are to the Internal Revenue Code in
effect for the taxable year at issue, and all Rule references are
to the Tax Court Rules of Practice and Procedure, unless
otherwise indicated.
Petitioners requested an evidentiary hearing; however, after
considering the record and the parties’ memoranda we concluded
that a hearing is not necessary to reach our decision. See Rule
232(a)(1). The relevant facts are taken from the record and the
parties’ memoranda. At the time the petition was filed,
petitioners resided in Temple Hills, Maryland.
After concessions,2 the issues for our consideration are:
(1) Whether respondent’s position in the litigation proceedings
was substantially justified; and (2) whether petitioners
unreasonably protracted the proceedings.
1(...continued)
respect to proceedings commenced after July 30, 1996. The
amendments to that section shift to the Commissioner the burden
of proving that the position of the United States was
substantially justified, sec. 7430(c)(4)(B).
A judicial proceeding is commenced in this Court with the
filing of a petition. See Rule 20(a). Petitioners filed their
petition on Aug. 20, 1997. Accordingly, the 1996 amendments to
sec. 7430 are applicable here. See Maggie Management Co. v.
Commissioner, 108 T.C. 430 (1997).
2 Respondent has conceded that petitioners substantially
prevailed, exhausted their administrative remedies, and met the
net worth requirements. In addition, respondent conceded that
his position after the calendar call of May 18, 1998, was not
substantially justified. Both parties agree that the hourly rate
at which attorney’s fees should be awarded is limited to $120 per
hour.
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Last modified: May 25, 2011