- 10 -
788, 1038-1039, 1055. The amendments made by TRA apply in the
case of proceedings commenced after August 5, 1997. Id.
Inasmuch as the petition herein was filed on September 2, 1997,
the amendments made by TRA apply in the present case.4
A. Requirements for a Judgment Under Section 7430
Under section 7430(a), a judgment for litigation costs
incurred in connection with a court proceeding may only be
awarded if a taxpayer: (1) Is the "prevailing party"; (2) has
exhausted his or her administrative remedies within the IRS; and
(3) did not unreasonably protract the court proceeding. Sec.
7430(a) and (b)(1), (3). Similarly, a judgment for
administrative costs incurred in connection with an
administrative proceeding may only be awarded under section
7430(a) if a taxpayer: (1) Is the "prevailing party"; and (2) did
not unreasonably protract the administrative proceedings. Sec.
7430(a) and (b)(3).
A taxpayer must satisfy each of the respective requirements
in order to be entitled to an award of litigation or
administrative costs under section 7430. Rule 232(e). Upon
satisfaction of these requirements, a taxpayer may be entitled to
4 Congress amended sec. 7430 in the IRS Restructuring and
Reform Act of 1998 (RRA 1998), Pub. L. 105-206, sec 3101, 112
Stat. 685, 727-730. However, the amendments made by RRA 1998
apply only to costs incurred more than 180 days after July 22,
1998. Inasmuch as none of the claimed costs were incurred more
than 180 days after July 22, 1998, the amendments made by RRA
1998 do not apply in the present case.
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