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According to the estate, Estate of Cervin v.
Commissioner, 111 F.3d 1252 (5th Cir. 1997), revg. T.C.
Memo. 1994-550, on remand T.C. Memo. 1998-176, affd. 200
F.3d 351 (5th Cir. 2000), “holds that the Government’s
litigating position includes pre-litigation proceedings”.
Our reading of Estate of Cervin v. Commissioner, supra,
does not reveal any such holding. In any event, even if
Estate of Cervin v. Commissioner, supra, could be so read,
we believe that under the decisions of the court to which
an appeal of this case would be taken, the United States
Court of Appeals for the Ninth Circuit, as under our own
decisions, section 7430 requires a bifurcated approach in
determining whether the position of the United States in a
judicial proceeding is substantially justified for purposes
of section 7430(c)(4)(B). See, e.g., Kenney v. United
States, supra; Huffman v. Commissioner, supra; Maggie Mgmt.
Co. v. Commissioner, supra; Swanson v. Commissioner, supra.
Furthermore, we cannot distinguish the cases utilizing
the bifurcated approach on the ground that “In each of
those cases the judicial proceedings were preceded by
administrative proceedings in which the taxpayers failed to
come forward with the evidence needed to resolve the
contested issues.” The bifurcated approach was formulated
because of the language of the statute, particularly, the
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