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substantially justified. The position of the United States in an
administrative proceeding is established as of the earlier of (1)
the date the taxpayer receives notice of a decision of the I.R.S.
Office of Appeals, or (2) the date of the notice of deficiency.
Sec. 7430(c)(7)(B). The position of the United States in a
deficiency proceeding in this Court is that set forth in the
Commissioner’s answer. E.g., Maggie Mgmt. Co. v. Commissioner,
108 T.C. 430, 442 (1997); see sec. 7430(c)(7)(A).
B. Substantial Justification
For purposes of section 7430, a position of the United
States is substantially justified if it has a reasonable basis in
both law and fact. E.g., Maggie Mgmt. Co. v. Commissioner, supra
at 443. The determination of the reasonableness of that position
is based upon the available facts that formed the basis for the
position, as well as any controlling legal precedent. Id. The
inquiry is not a static one; that is, a position of the United
States that was reasonable when established may become
unreasonable in light of changed circumstances. See, e.g., Wasie
v. Commissioner, 86 T.C. 962, 969 (1986); see also sec. 301.7430-
5(c)(2), Proced. & Admin. Regs. (any award of administrative
costs may be limited to costs attributable to the portion of the
proceeding during which the position of the I.R.S. was not
substantially justified). The fact that the Commissioner
ultimately concedes an issue does not, by itself, establish that
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