Sandra L. Andary-Stern - Page 15




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          was substantially justified.  Sec. 7430(c)(4)(B).  Respondent               
          concedes that petitioner prevailed with respect to the issues               
          presented and meets the applicable net worth requirement but                
          contends that his position was substantially justified.                     
               Whether respondent’s position was substantially justified is           
          to be resolved by applying a reasonableness standard.  Pierce v.            
          Underwood, 487 U.S. 552, 564 (1988); Sher v. Commissioner, 89               
          T.C. 79, 84 (1987), affd. 861 F.2d 131 (5th Cir. 1988).                     
          Respondent’s position is reasonable if the position had a                   
          reasonable basis in both fact and law.  Norgaard v. Commissioner,           
          939 F.2d 874, 881 (9th Cir. 1991), affg. in part and revg. in               
          part T.C. Memo. 1989-390.  The fact that respondent concedes a              
          case does not automatically mean that his position was not                  
          substantially justified.  Sokol v. Commissioner, 92 T.C. 760, 767           
          (1989).  In determining the reasonableness of respondent’s                  
          position, the Court may consider all relevant factors.  Rutana v.           
          Commissioner, 88 T.C. 1329, 1333 (1987).                                    
               To decide whether respondent’s position was substantially              
          justified, the Court must first identify when respondent is                 
          considered to have taken a position and then decide whether the             
          position taken from that day forward was substantially justified.           
          In general, we bifurcate our analysis and consider separately the           
          positions taken in the administrative proceeding and the judicial           
          proceeding.  Huffman v. Commissioner, 978 F.2d 1139, 1148 (9th              






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