- 14 -
show that the stance it had taken in the proceedings was
substantially justified because it would not be considered to
have taken a “position” under section 7430(c)(7). Taxpayers
would therefore be able to recover administrative costs incurred
before the issuance of a notice of deficiency or Appeals Office
decision, whether or not the Government’s position was
substantially justified. There is no indication that the TBOR 2
amendment was designed to have such an effect.
The TBOR 2 amendment sought to shift to the Government the
“burden of proof to establish that it was substantially justified
in maintaining its position against the taxpayer.” H. Rept.
104-506, at 37 (1996), 1996-3 C.B. 49, 85. There is no
indication that the amendment was intended, in addition to
shifting the burden to the Government, to prevent the Government
from showing that its position was substantially justified.
Likewise, nothing in the legislative history to TBOR 2
suggests that the amendment to section 7430(c)(4)(A) was intended
to alter the effect of section 7430(c)(7). We have previously
found that the effect of subsection (c)(7) is to “protect the
Commissioner from claims by taxpayers that positions taken by,
for example, the Examination or Collections Division personnel,
before issuance of a notice of deficiency or of the decision of
Appeals, are not substantially justified.” Ball v. Commissioner,
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011