John Bowden, Inc. - Page 7

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               This case was later settled, and it was stipulated that the            
          corporation had made an overpayment in income tax of $4,377 for             
          taxable year ending June 30, 1992, and had a deficiency in the              
          amount of $199 for taxable year ending June 30, 1993.  The                  
          corporation subsequently filed a motion for an award of                     
          reasonable litigation costs.                                                
               Taxpayers may be awarded an amount for reasonable litigation           
          costs if they meet the requirements of section 7430.  In order to           
          qualify for such an award, a party must:  (1) Qualify as a                  
          prevailing party; (2) have exhausted available administrative               
          remedies; (3) not have unreasonably protracted the court                    
          proceeding; and (4) show that the costs claimed are reasonable              
          litigation costs incurred in connection with the court                      
          proceeding.  Sec. 7430(c)(4), (b)(1), (b)(4), (a)(2).  The                  
          taxpayers have the burden of establishing that all the foregoing            
          criteria have been satisfied.  See Rule 232(e); Maggie Management           
          Co. v. Commissioner, 108 T.C. 430 (1997).                                   
               Both petitioner and respondent agree that all the                      
          administrative remedies available within the Internal Revenue               
          Service have been exhausted.  There is some dispute, however, as            
          to the other requirements of section 7430.                                  
               Prevailing Party                                                       
               To be a "prevailing party", a taxpayer must establish:                 

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