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The Court agrees with and adopts the opinion of the Special
Trial Judge, which is set forth below.
OPINION OF THE SPECIAL TRIAL JUDGE
DINAN, Special Trial Judge: This case is before the Court
on petitioners’ motion, and supplemental motion, for award of
litigation and administrative costs pursuant to the provisions of
Rule 231 and of section 7430 of the Internal Revenue Code in
effect at the time the petition in this case was filed.
Although respondent requested a hearing on this motion, we
find that a hearing is not necessary. See Rule 232(a).
Accordingly, we rule on petitioners’ motion on the basis of the
parties’ submissions and the existing record. Petitioners
resided in Oklahoma City, Oklahoma, at the time the petition was
filed in this case.
Background
The overriding issue in this case was the substantiation of
expenses and costs of goods sold claimed by petitioners to have
been incurred in connection with petitioner husband’s
(petitioner) business. While the question of whether petitioners
initially maintained adequate business records remains disputed
by the parties, the poor condition of the records at the time of
respondent’s examination is not disputed. Petitioner contends
that a fire partially destroyed his records, making them
unavailable to respondent. The parties agree that for one reason
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