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II. Misapplying the Abuse of Discretion Standard
A. Introduction
While we disagree with the majority’s conclusion that the
scope of review–-a trial de novo-–is correct, we recognize that
the Court has previously adopted abuse of discretion as the
standard of review for section 6015(f) cases. See, e.g., Jonson
v. Commissioner, 118 T.C. at 125. Courts generally hold that a
decisionmaker abuses his discretion “when it makes an error of
law * * * or rests its determination on a clearly erroneous
finding of fact * * * [or] applies the correct law to facts which
are not clearly erroneous but rules in an irrational manner.”
United States v. Sherburne, 249 F.3d 1121, 1125-1126 (9th Cir.
2001); see also Cooter & Gell v. Hartmarx Corp., 496 U.S. 384,
402-403 (1990) (same).
The majority describes the abuse of discretion standard as
follows: “The taxpayer bears a heavy burden of proof, the
Commissioner’s position deserves our deference, and we do not
interfere unless the Commissioner’s determination is arbitrary,
capricious, clearly unlawful, or without sound basis in fact or
law.” Majority op. pp. 13-14. Accepting the majority at its
word–-the proper approach is de novo review, applying an abuse of
discretion standard, majority op. p. 20–-we fail to see how the
majority has done anything other than ignore its description of
the abuse of discretion standard and, instead, substitute its
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