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has evidence which is not favorable to him. Recklitis v.
Commissioner, 91 T.C. 874, 890 (1988); Wichita Terminal Elevator
Co. v. Commissioner, 6 T.C. 1158, 1165 (1946), affd. 162 F.2d 513
(10th Cir. 1947). We find that respondent's position was
substantially justified during the time petitioner failed to
produce evidence to substantiate the expenditures of The Fourth
Dreamer. Mills v. Commissioner, T.C. Memo. 1999-60; Cooper v.
Commissioner, T.C. Memo. 1999-6.
With regard to the administrative costs, we examine the
period beginning at the time respondent issued the notice of
deficiency to petitioner on February 2, 1999, the relevant date
in this case. At that time respondent had not received any
records from petitioner that would substantiate the business
expenses of The Fourth Dreamer and corroborate that petitioner
had no constructive dividends. Petitioner had repeatedly refused
to provide respondent with the records of The Fourth Dreamer
since June 1997. On April 29, 1999, petitioner began to provide
the requested information. We find that respondent's position
throughout that period was substantially justified.
With respect to the litigation costs, respondent filed his
answer on July 1, 1999. Respondent agreed to concede the case on
January 19, 2000. Petitioner contends that respondent had all
the information upon which to base a concession by April 29,
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