Gary Gealer - Page 7

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          filed the decision as a stipulation of settled issues, and filed            
          petitioner’s motion.                                                        
               Under section 7430, a taxpayer may be awarded a judgment for           
          reasonable administrative and litigation costs if the taxpayer              
          establishes that he was the prevailing party, unless the                    
          Commissioner establishes that the Commissioner’s position was               
          substantially justified.  Sec. 7430(c)(4)(A) and (B).                       
               We review the Commissioner’s position as of the earlier of             
          the date of the receipt by the taxpayer of the notice of decision           
          by the Office of Appeals or the date of the notice of deficiency            
          to determine whether the Commissioner was substantially justified           
          with respect to the recovery of administrative costs.  Sec.                 
          7430(c)(7)(B).  In deciding the merits of a motion for litigation           
          costs, we consider the reasonableness of the Commissioner’s                 
          position from the date the answer to the petition was filed.                
          Sec. 7430(c)(7)(A); Bertolino v. Commissioner, 930 F.2d 759, 761            
          (9th Cir. 1991).  We consider the reasonableness of each of these           
          positions separately.  Huffman v. Commissioner, 978 F.2d 1139,              
          1144-1147 (9th Cir. 1992), affg. in part, revg. in part and                 
          remanding on other issues T.C. Memo. 1991-144.                              
               Whether the Commissioner’s position was substantially                  
          justified turns on a finding of reasonableness, based upon all              
          the facts and circumstances, as well as the legal precedents                

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