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costs. Their third approach relates to the deductibility of both
those costs and the professional fees, and it posits that
respondent’s concession in June of 2002 of both issues, almost 3
months after the issuance of CNN 2002-21 and 4 months after
issuance of the ANPRM and Announcement 2002-9 (and some 3 years
after the issuance of Rev. Rul. 99-23) was not timely. We
consider each argument in turn.
B. Effect of Respondent’s Litigating Against a Position
Likely To Be Adopted in the Future
Petitioners characterize the listing of “loan origination
costs” as an item slated for 2000 IRS published guidance as a
step that “evidences years of intensive, and ultimately
successful, lobbying by the likes of the INDOPCO Coalition to
impress its views on the IRS.” Petitioners appear to be
suggesting that the selection of loan origination costs for 2000
published guidance was tantamount to an IRS decision, on March
21, 2000, to treat those costs as deductible in the taxable year
incurred. Therefore, respondent was not substantially justified
in seeking to capitalize petitioners’ loan origination/
acquisition costs in 2000, despite the subsequent 2001 decision
of the Tax Court in Lychuk v. Commissioner, 116 T.C. 374 (2001),
sustaining the Commissioner’s capitalization of those costs. We
disagree.
As noted supra, there is a rebuttable presumption of no
substantial justification if respondent fails to follow his own
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