- 6 -
exhaust the administrative remedies available to them, and that
the costs petitioners claim are unreasonable. In contrast,
petitioners contend that they were the prevailing party with
respect to both the amount in controversy and the most
significant issue or set of issues, that they exhausted all
available administrative remedies, and that the amount of
litigation costs sought is reasonable.
Section 7430(c)(4)(A) and (B)(i) provides that a taxpayer is
a prevailing party if (1) the Commissioner’s position in the
court proceeding was not substantially justified, (2) the
taxpayer substantially prevailed with respect to the amount in
controversy or the most significant issue or set of issues, and
(3) the taxpayer meets the net worth requirements of 28 U.S.C.
section 2412(d)(2)(B) (2000). See also sec. 301.7430-5(a),
Proced. & Admin. Regs. Although the taxpayer has the burden of
proving that the taxpayer meets requirements (2) and (3), supra,
the Commissioner must show that the Commissioner’s position was
substantially justified. See sec. 7430(c)(4)(B)(i); Rule 232(e).
Respondent concedes that petitioners meet the net worth
requirement of 28 U.S.C. section 2412(d)(2)(B). We first
consider whether respondent’s position in the court proceeding
was substantially justified.
Page: Previous 1 2 3 4 5 6 7 8 9 10 Next
Last modified: May 25, 2011