David J. Edwards - Page 23

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          Spaid’s response, we will order Ms. Spaid to reimburse respondent           
          for 54 hours of Ms. Zusi’s time and 11.25 of Ms. Moe’s time.  See           
          appendix.                                                                   
               We find that the $200 hourly rate requested by respondent is           
          reasonable.  See Nis Family Trust v. Commissioner, 115 T.C. 523,            
          552 (2000) (holding that $200 an hour was a reasonable rate for             
          both Ms. Zusi and Ms. Moe).  Accordingly, the lodestar amount is            
          $10,800 for Ms. Zusi’s time and $2,250 for Ms. Moe’s time.                  
          Respondent has not itemized costs for travel expenses,                      
          photocopying, or supplies used in preparing the case, nor for the           
          time spent in preparing respondent’s affidavit.  Respondent                 
          limits his request for costs to the lodestar amount.  We shall              
          require Ms. Spaid to pay $13,050 in respondent’s excess costs               
          reflecting the total lodestar amount.                                       
          Conclusion                                                                  
               In the case at hand, petitioner took frivolous and                     
          groundless positions and unreasonably failed to pursue available            
          administrative remedies.  We believe $24,000 is a substantial but           
          appropriate penalty for petitioner to pay the United States under           
          section 6673(a)(1).  Therefore, the decision to be entered                  
          against petitioner, in addition to determining the deficiencies             
          and section 6662(a) accuracy-related penalties, will require                
          petitioner to pay a penalty of $24,000 to the United States                 
          pursuant to section 6673(a)(1).                                             






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