Phillip A. O'Bryon and Cyndie W. O'Bryon - Page 9

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          Commissioner, supra at 442.  Respondent's position in the                   
          proceeding before this Court was established on November 20,                
          1998, the date respondent filed the answer.  In the present case,           
          it is not necessary to analyze respondent’s position separately,            
          because respondent took the same position on each issue in both             
          the notice of deficiency and the answer.  See Swanson v.                    
          Commissioner, 106 T.C. 76, 87 (1996).                                       
               We now consider whether respondent's position was                      
          substantially justified.  We analyze respondent's position in the           
          context of the circumstances that caused respondent to take that            
          position and the manner in which respondent maintained that                 
          position.  See Wasie v. Commissioner, supra at 969; Kahn-Langer             
          v. Commissioner, T.C. Memo. 1995-527; Amann v. Commissioner, T.C.           
          Memo. 1993-542, affd. without published opinion 40 F.3d 1235 (1st           
          Cir. 1994).  We may also consider:  (1) Whether the Government              
          used the costs and expenses of litigation against its position to           
          extract concessions from the taxpayer that were not justified               
          under the circumstances of the case; (2) whether the Government             
          pursued the litigation against the taxpayer for purposes of                 
          harassment or embarrassment, or out of political motivation; and            
          (3) such other factors as the Court finds relevant.  See Sher v.            
          Commissioner, 89 T.C. 79, 85 (1987), affd. 861 F.2d 131 (5th Cir.           
               Our analysis of what caused respondent to take a position              

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