- 10 -
thereafter. Cf. Sliwa v. Commissioner, 839 F.2d 602, 609 (9th
Cir. 1988) (6-month delay between I.R.S. receipt of requested
documents and resulting concession of case was not objectively
unreasonable), affg. an unreported Order of this Court. Thus,
respondent’s position was substantially justified throughout the
duration of the judicial proceeding.
In essence, petitioners complain that respondent had no
basis for challenging the section 151(c) deductions in the first
place (at least with regard to two of the children).8 Given
petitioners’ failure to respond to respondent’s September 5, 2000
letter in a timely manner, that is not a valid claim. See
Roberts v. Commissioner, 62 T.C. 834, 836-837 (1974) (in the
context of a taxpayer’s refusal to substantiate his deductions,
the Court rejected the argument that the Commissioner may assess
deficiencies only when he has specific information that a claimed
deduction is not permitted); cf. Powers v. Commissioner, 100 T.C.
457, 472-474 (1993) (Commissioner’s position in notice of
deficiency was not substantially justified because it had no
factual basis and the Commissioner had made no attempt to obtain
information about the case before adopting the position), affd.
in part and revd. in part on another issue, 43 F.3d 172 (5th Cir.
1995). Taxpayers must be prepared to substantiate their
deductions upon request. See sec. 6001 (requiring taxpayers to
8 See supra note 3.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011