Joseph W. Evans, Jr. and Mildred S. Evans - Page 10




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          judgment for litigation costs), sec. 7430(b)(1), that the                   
          taxpayer has not unreasonably protracted the administrative or              
          judicial proceedings, sec. 7430(b)(4), redesignated as (b)(3) by            
          the 1996 Act, and that the costs claimed are reasonable in                  
          amount, sec. 7430(c)(1) and (2).  These requirements are in the             
          conjunctive and each must be met in order for the Court to                  
          determine that administrative or litigation costs should be                 
          awarded pursuant to section 7430.  Minahan v. Commissioner, 88              
          T.C. 492 (1987); Renner v. Commissioner, T.C. Memo. 1994-372.               
               Petitioners contend that they have substantially prevailed             
          with respect to the amounts in controversy and on the most                  
          significant issue in this case.  They further contend that they             
          have met the net worth requirements of 28 U.S.C., sec.                      
          2412(d)(2)(B), that they have exhausted the administrative                  
          proceedings available to them within the Internal Revenue                   
          Service, and that they have not unreasonably protracted the                 
          administrative or court proceedings.  They also argue that the              
          costs claimed are reasonable.                                               
               Respondent agrees that petitioners have substantially                  
          prevailed, that they meet the net worth requirements of 28                  
          U.S.C., sec. 2412(d)(2)(B), and that they have exhausted the                
          administrative remedies available to them with the Internal                 
          Revenue Service.  Respondent does not agree that his position was           
          not substantially justified, he does not agree that petitioners             
          did not unreasonably protract the litigation, and he does not               
          agree that the costs claimed are reasonable.                                


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