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The workers described in the notice of determination were
properly classified as employees for the tax periods at issue;
(2) petitioner was not entitled to relief under section 530 of
the Revenue Act of 1978 with respect to such individuals; and (3)
petitioner owed $33,170.68 of additional Federal employment
taxes.
As stated above, respondent contends that his position is
substantially justified. Respondent’s position is substantially
justified if it has a reasonable basis in both fact and law.
Maggie Mgmt. Co. v. Commissioner, supra at 443; DeVenney v.
Commissioner, 85 T.C. 927, 930 (1985); sec. 301.7430-5(c),
Proced. & Admin. Regs. We apply the reasonable person standard
to determine reasonableness. See Pierce v. Underwood, 487 U.S.
552, 565 (1988) (stating that the Commissioner’s position is
substantially justified if it is supported “to a degree that
could satisfy a reasonable person”). The reasonableness of the
Commissioner’s position is based on the available facts used to
form his position and legal precedents related to the case.
Maggie Mgmt. Co. v. Commissioner, supra at 443. We shall review
the reasonableness of respondent’s factual and legal positions
together since employment status is generally a factual question.
See Weber v. Commissioner, 103 T.C. 378, 386 (1994), affd. per
curiam 60 F.3d 1104 (4th Cir. 1995).
A significant factor we use in deciding whether the
Commissioner’s position is substantially justified is whether the
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