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forward this case to the Appeals Office after petitioner filed a
valid written request was not the result of a failure of
compliance by petitioner. Given the facts of this case, we find
petitioner did not unreasonably protract these proceedings within
the meaning of section 7430(b)(3).
D. Litigation Costs Petitioner Claimed
Petitioner’s motion is only for litigation costs. Section
7430 limits the prevailing party to an award of reasonable
litigation costs.5 Section 7430(c)(1)(B)(iii) generally limits
the hourly rate for attorney’s fees.6 A taxpayer may recover
attorney’s fees above the statutory limit if the court determines
the existence of a special factor such as: (1) Limited
availability of qualified attorneys for the proceeding; (2) the
difficulty of the issues present in the case; or (3) the local
availability of tax expertise. Id.
Petitioner claims that its counsel deserves a rate of $250
per hour for the 118.25 hours he spent in connection with these
proceedings. Respondent challenges the hourly rate claimed since
it is above the statutory limit and questions whether some of the
5Reasonable litigation costs include, inter alia, reasonable
court costs and fees paid or incurred for the services of
attorneys in connection with a court proceeding (attorney’s
fees). Sec. 7430(c)(1).
6Rev. Proc. 2002-70, sec. 3.32, 2002-2 C.B. 845, 850; Rev.
Proc. 2003-85, sec. 3.33, 2003-2 C.B. 1184, 1190; and Rev. Proc.
2004-71, sec. 3.35, 2004-2 C.B. 970, 976, respectively, state
that the hourly rate for attorney’s fees during 2003-2005 is
$150.
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