- 7 -
substantially justified in arguing that the MBA program
constituted a minimum educational requirement. See Allemeier v.
Commissioner, T.C. Memo. 2005-207. Similarly, although we found
that petitioner’s MBA “enhanced” his preexisting skills rather
than qualified him to perform “significantly” different tasks and
activities, we find that respondent was substantially justified
in arguing that petitioner’s course of study qualified him for a
new trade or business. Id.
Accordingly, we find that respondent’s position was
substantially justified.6 Petitioner is therefore not the
prevailing party and may not recover any litigation costs. See
sec. 7430(c)(4)(B). In light of this holding, we need not decide
whether petitioner exhausted administrative remedies or whether
the legal costs petitioner claimed are reasonable.7 See, e.g.,
Kean v. Commissioner, T.C. Memo. 2003-275, affd. 407 F.3d 186 (3d
Cir. 2005); Gutierrez v. Commissioner, T.C. Memo. 1995-569 (where
6For similar reasons, we also conclude that respondent’s
position regarding the accuracy-related penalty was substantially
justified. See Uddo v. Commissioner, T.C. Memo. 1998-276.
7We note that petitioner submitted a $15,553 billing
statement for litigation costs from his father, a non-tax
attorney who entered no appearance in this proceeding and is
ineligible to practice before the Court, but petitioner made no
showing that he actually paid or was legally obligated to pay the
fees to his father. See sec. 7430(a)(2), (c)(1)(B)(iii); Frisch
v. Commissioner, 87 T.C. 838, 846 (1986) (taxpayer not eligible
to recover fees when taxpayer had no liability for the fees);
Republic Plaza Props. Pship. v. Commissioner, T.C. Memo. 1997-
239.
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