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Discussion
Section 7430(a) authorizes an award to the prevailing
party of reasonable litigation costs incurred in connection with
a court proceeding brought against the United States involving
the determination of any tax, interest, or penalty under the
Code. In order to qualify for such an award, that party must
(1) show that the costs claimed are reasonable litigation costs
incurred in connection with the court proceeding, section
7430(a)(2); (2) have exhausted the available administrative
remedies, section 7430(b)(1); (3) not have unreasonably protracted
the court proceeding, section 7430(b)(4); and (4) qualify as a
prevailing party, section 7430(c)(4). PFI has the burden of
establishing that all of the foregoing criteria have been satis-
fied.2 See Rule 232(e); Minahan v. Commissioner, 88 T.C. 492,
496-497 (1987).
To qualify as a prevailing party under section 7430(c)(4),
PFI must show, inter alia, that at the time the petition in this
case was filed the net worth requirements of 28 U.S.C. sec.
2412(d)(2)(B) (1994) (net worth requirements) were met. Sec.
7430(c)(4)(A)(iii).
2 The amendments to sec. 7430 by the Taxpayer Bill of Rights 2,
Pub. L. 104-168, secs. 701-704, 110 Stat. 1452, 1463-1464 (1996)
are effective with respect to proceedings commenced after July
30, 1996, and therefore are not applicable to PFI's motion.
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