Curtis and Mary Ettesvold - Page 10

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                 The regulations under section 7430, requiring a party                
            to pursue administrative remedies within the Internal                     
            Revenue Service, are subject to various limited exceptions.               
            See sec. 301.7430-1(f), Proced. & Admin. Regs.  Petitioners’              
            motion and accompanying brief, however, give us no reason to              
            believe that any such exception is applicable in this case,               
            nor do petitioners’ motion and brief suggest that the                     
            statutory rule requiring exhaustion of administrative                     
            remedies is otherwise unnecessary.  The entire discussion                 
            of this issue in petitioners’ brief is as follows:  “The                  
            statutory notice of deficiency was issued by the Internal                 
            Revenue Service on August 12, 1998.  Curtis and Mary                      
            Ettesvold pursued all of their administrative remedies.”                  
                 For the above reasons, we cannot determine, on the                   
            basis of the record, that petitioners exhausted their                     
            administrative remedies in the Internal Revenue Service.                  
            See sec. 301.7430-1(b)(1)(i), Proced. & Admin. Regs.                      
            Accordingly, we hold that petitioners are not eligible,                   
            pursuant to the limitations of section 7430(b)(1), to be                  
            awarded reasonable litigation costs.  See Haas & Associates               
            Accountancy Corp. v. Commissioner, 117 T.C. 48 (2001), affd.              
            55 Fed. Appx. 476 (9th Cir. 2003); Patel v. Commissioner,                 
            T.C. Memo. 1998-306.                                                      






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