- 5 - Pursuant to section 7430, we may award reasonable litigation and administrative costs to a prevailing party in any tax proceeding with the United States. Litigation costs will not be awarded unless the prevailing party establishes that it exhausted its administrative remedies. Sec. 7430(b)(1). In addition, the prevailing party may not receive an award relating to any portion of the proceedings that such party unreasonably protracted. Sec. 7430(b)(4). Respondent concedes that petitioner has exhausted its administrative remedies, but contends that petitioner has failed to establish: (1) It was a prevailing party; (2) it did not unreasonably protract this proceeding; and (3) its litigation costs were reasonable. I. Prevailing Party To be a "prevailing party", a party in the proceeding must: (1) Establish that the position of the United States was not substantially justified; (2) substantially prevail in the controversy; and (3) meet the net worth and number of employees requirements (net worth requirements) of the Equal Access to Justice Act (EAJA), 28 U.S.C. sec. 2412(d)(2)(B) (1994). Sec. 7430(c)(4)(A). Respondent concedes that petitioner has substantially prevailed in this controversy, but contends that petitioner has failed to satisfy the remaining requirements. A. Substantial Justification Respondent's positions are substantially justified only if they have a reasonable basis in law and fact. Norgaard v.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011