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eventually hired an attorney to assist him. On Apr.
14, 1997, P provided R with all of the information
needed to process P's return. On May 30, 1997, R
issued refund checks to P for the 1987 and 1988 taxable
years. On June 2, 1997, R abated for reasonable cause
additions to tax for late filing and negligence that
had been assessed for 1987 and 1988. Pursuant to sec.
7430, I.R.C., P made an administrative claim for costs
associated with the preparation and filing of P's 1987
and 1988 tax returns.
Held: Costs associated with filing and correcting
P's tax returns were incurred in providing R with all
the information necessary to process P's returns. P is
not entitled to recover such costs because, until P
provided to R all information relevant (including a
properly signed tax return) to processing P's tax
return, R's position was substantially justified. See
sec. 301.7430-5(h) Example (3), Proced. & Admin. Regs.
Held: P is not entitled to recover administrative
costs incurred after P provided all relevant
information to R because R processed P's return within
a reasonable period of time after receiving such
information.
Phillip J. Vecchio, for petitioners.
Robert E. Marum, for respondent.
WELLS, Chief Judge: The instant case involves petitioners'
claim for administrative costs of $5,377.22 pursuant to section
7430.1 Some of the facts have been stipulated and are so found.
1 Unless otherwise indicated, all section references are to
the Internal Revenue Code as amended and in effect for the years
in issue. Sec. 7430 of the Internal Revenue Code was amended by
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