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petitioners claimed just before the start of the trial. To
paraphrase our comment in Bragg v. Commissioner, 102 T.C. at 719,
no matter which method or manner of analysis we use, petitioners
come out substantially defeated.6 Petitioners’ defeat is all the
clearer when the $2,700 overpayment amount (even as enhanced by
interest accruing after May 6, 2003, per the parties’ agreement)
is compared to petitioners’ claim for almost $60,000 in
litigation costs. See, e.g., Dang v. Commissioner, 259 F.3d 204,
206 (4th Cir. 2001), affg. an unreported order and decision of
this Court entered July 21, 2000.
We hold, for respondent, that petitioners did not
substantially prevail with respect to the amount in controversy.
Sec. 7430(c)(4)(A)(i)(I).
C. Conclusion
Petitioners have not “substantially prevailed” with respect
to either the amount in controversy or the most significant issue
or set of issues presented. Accordingly, petitioners are not a
“prevailing party” for purposes of section 7430. Because the
requirements of section 7430 are in the conjunctive, we need not
6 We note petitioners’ suggestion in their legal memorandum
that respondent’s concession of the additional $15,000 contention
“should affect any consideration of the amount in controversy
component of the test.” If we were to do so, adding that amount
to the totals, supra in table 1, would result in petitioners’
claiming relief of about $70,000 and obtaining relief of less
than $18,000. Even under this approach, petitioners would have
prevailed as to only one-fourth of the amount in controversy.
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