Reggi

This matter came on for hearing on the plaintiffs’ application for an award of attorney fees pursuant to 26 U.S.C. § 7430 (a). For the reasons stated, the motion is denied and this action dismissed.

This complaint for a tax refund was filed on November 26, 1984. The issues in the case involved the substantiation of deductions claimed by plaintiffs on their 1979 tax return. The plaintiffs’ 1979 return had been filed on or about May 19, 1980. Upon audit the IRS disallowed certain deductions claimed by plaintiffs for lack of substantiation. An assessment was made on September 6, 1982. Plaintiffs paid the assessment and on or about January 26, 1984 filed an amended tax return claiming a refund of the additional taxes paid and enclosing substantiation for the claimed deductions.

The IRS was in the process of examining the amended return and accompanying substantiation when this lawsuit was filed on November 26, 1984. In fact, the Revenue Agent assigned the return had determined to allow the claim based on the substantiation. However, as soon as this lawsuit was commenced, jurisdiction over the action was transferred to the Department of Justice. '

On January 28, 1985 the U.S.…