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Discussion
A. Motion for Administrative and Litigation Costs
Generally, a taxpayer who has substantially prevailed in
a Tax Court proceeding may be awarded reasonable administrative
and litigation costs. Sec. 7430(a), (c). To be entitled to an
award, the taxpayer must:
1. Exhaust administrative remedies.2 Sec. 7430(b)(1).
Respondent concedes that petitioners meet this requirement.
2. Substantially prevail with respect to the amount in
controversy. Sec. 7430(c)(4)(A)(ii)(I). Respondent concedes
that petitioners meet this requirement.
3. Be an individual whose net worth did not exceed $2
million, or an owner of an unincorporated business, or any
partnership, corporation, etc., the net worth of which did not
exceed $7 million, when the petition was filed. Sec.
7430(c)(4)(A)(iii); 28 U.S.C. sec. 2412(d)(2)(B) (1988).
Respondent concedes that petitioners meet this requirement.
4. Show that the position of the United States in the
action was not substantially justified. Sec. 7430(c)(4)(A)(i).
2 This requirement does not apply to an award for reasonable
administrative costs. Sec. 7430(b)(1).
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Last modified: May 25, 2011