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OPINION
A taxpayer who substantially prevails in an administrative
or court proceeding may be awarded a judgment for reasonable
costs incurred in such proceedings. Sec. 7430(a)(1) and (2).
Issue 1. Whether Petitioners Are the Prevailing Parties
For this Court to award reasonable administrative and
litigation costs under section 7430, several requirements must be
met. The record must show that: (1) The moving party did not
unreasonably protract the administrative proceeding or the
proceeding in this Court. Sec. 7430(b)(4). Based upon the
entire record, we find that petitioner did not unreasonably
protract the proceedings. (2) The moving party exhausted any
administrative remedies available to him or her in the Internal
Revenue Service. Sec. 7430(b)(1).3 Based upon the record, we
find that petitioner has met this requirement. (3) The moving
party was the prevailing party. Sec. 7430(a). As discussed
below, we find petitioner has met this requirement.
Generally, a taxpayer considered to be a prevailing party in
a civil tax proceeding may be awarded a judgment for reasonable
administrative and litigation costs incurred in that proceeding.
Sec. 7430(a)(1) and (2). A taxpayer must satisfy several
conjunctive requirements to be deemed a prevailing party. Sec.
7430(c). The taxpayer must establish: (1) That the position of
3 This requirement applies only to a judgment for an
award of reasonable litigation costs. Sec. 7430(b)(1).
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Last modified: May 25, 2011