- 6 - In the case before us, Mr. Kean made payments to Ms. Kean pursuant to a series of orders from a New Jersey court, and this Court applied New Jersey law in its determination as to whether the disputed payments constituted alimony pursuant to section 71. Ultimately, this Court distinguished the facts of Gonzales from the facts of the instant case, and determined that the disputed payments in the instant case were alimony. Nonetheless, based on the fact that Gonzales and the instant case both involve unallocated support payments and interpretation of New Jersey law, respondent’s reliance on Gonzales to frame his answer in the instant case was substantially justified. Based on the facts available to respondent, as well as the legal precedent regarding the deductibility of unallocated support payments, specifically this Court’s holding in Gonzales v. Commissioner, supra, respondent’s position in his answer had a reasonable basis in both law and fact, and therefore was substantially justified. Because respondent’s position in the judicial proceeding was substantially justified, Mr. Kean is not deemed to be a prevailing party as defined in section 7430(c)(4). Consequently, Mr. Kean is not entitled to recover any of his claimed costs under section 7430. As a result of this holding, we need not address the questions of whether Mr. Kean meets the net worthPage: Previous 1 2 3 4 5 6 7 Next
Last modified: May 25, 2011