- 8 -
with an administrative proceeding may only be awarded under
section 7430(a) if a taxpayer: (1) Is the "prevailing party";
and (2) did not unreasonably protract the administrative
proceeding. See sec. 7430(a) and (b)(3). Similarly, a judgment
for litigation costs incurred in connection with a court
proceeding may only be awarded if a taxpayer: (1) Is the
"prevailing party"; (2) has exhausted his or her administrative
remedies within the IRS; and (3) did not unreasonably protract
the court proceeding. See sec. 7430(a), (b)(1), (3).
A taxpayer must satisfy each of the respective requirements
in order to be entitled to an award of litigation or
administrative costs under section 7430. See Rule 232(e). Upon
satisfaction of these requirements, a taxpayer may be entitled to
reasonable costs incurred in connection with the administrative
or court proceeding. See sec. 7430(a)(2) and (c)(1).
To be a prevailing party, the taxpayer must substantially
prevail with respect to either the amount in controversy or the
most significant issue or set of issues presented and satisfy the
applicable net worth requirement. See sec. 7430(c)(4)(A).
Respondent concedes that petitioner has satisfied the
requirements of section 7430(c)(4)(A). Petitioner will
nevertheless fail to qualify as the prevailing party if
respondent can establish that respondent's position in the court
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011