- 14 -
subsequent abandonment of that position without any additional
factual development. For example, in Coastal Petroleum Refiners,
Inc. v. Commissioner, 94 T.C. 685, 689-690 (1990), the
Commissioner acknowledged “that his post-trial concession was not
based upon new facts presented at trial, but rather upon a
reconsideration of his basic legal position”, and we agreed that
such concession “was based on an abandonment of his legal
position.” We nevertheless found the Commissioner’s position to
be reasonable. Id. at 694-695.
This Court has observed: “The fact that respondent’s
counsel ultimately [decides] to concede the case may reflect a
consideration of a variety of factors-–including litigation
risks--which earlier were not considered or which were not
weighed as heavily by respondent.” Estes v. Commissioner, T.C.
Memo. 2000-96. Such appears to be the case here. We conclude
that despite respondent’s concession of the underlying dispute
between the parties, his position with respect to the discharge
of indebtedness issue was reasonable.
B. The Penalty Issue
As noted above, respondent asserted that petitioners were
liable for the section 6662 accuracy-related penalty due to
petitioners’ negligence or disregard of rules or regulations.
Section 6662(c) provides that, for purposes of section 6662, the
term “negligence” includes any failure to make a reasonable
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
Last modified: May 25, 2011