- 8 -
Finally, respondent does not agree that the claimed costs are
reasonable.
We first consider whether respondent's position in this
case was substantially justified. For the reasons stated,
infra, we find that it was.
Whether respondent's position was substantially justified
depends on whether respondent's position and actions were
reasonable in light of the facts of the case and applicable
precedents. Bragg v. Commissioner, 102 T.C. 715, 716 (1994);
Powers v. Commissioner, 100 T.C. 457, 470-471 (1993), affd. in
part and revd. and remanded in part 43 F.3d 172 (5th Cir.
1995). The fact that respondent concedes a part of the case
is not necessarily indicative that a position is not
substantially justified. Price v. Commissioner, 102 T.C. 660,
662-665 (1994), affd. without published opinion sub nom.
TSA/THE Stanford Associates, Inc. v. Commissioner, 77 F.3d 490
(9th Cir. 1996). A position is "substantially justified" when
it is "justified to a degree that could satisfy a reasonable
person." Pierce v. Underwood, 487 U.S. 552, 565 (1988).
The principal issue in this case is one of
substantiation. At the administrative level, petitioners were
reluctant to provide to respondent's examining agent
substantiation of their claimed expenses other than the ledger
prepared by their accountant based upon unsubstantiated
information they had provided to him.
Page: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011