26 U.S. Code § 7430 - Awarding of costs and certain fees

Inflation Adjusted Items for Certain Years

For inflation adjustment of certain items in this section, see Revenue Procedures listed in a table under section 1 of this title.

Prior Provisions

A prior section 7430 was renumbered section 7437 of this title.

Amendments

2017—Subsec. (c)(1). Pub. L. 115–97 substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)” in concluding provisions.

2000—Subsec. (c)(3). Pub. L. 106–554, § 1(a)(7) [title III, § 319(25)(A)], substituted “Attorneys’ ” for “Attorneys” in heading.

Subsec. (c)(3)(B). Pub. L. 106–554, § 1(a)(7) [title III, § 319(25)(B)], substituted “attorneys’ fees” for “attorneys fees” wherever appearing.

1998—Subsec. (b)(4), (5). Pub. L. 105–206, § 6012(h), redesignated par. (5) as (4).

Subsec. (c)(1)(B)(iii). Pub. L. 105–206, § 3101(a), substituted “$125” for “$110” and inserted “the difficulty of the issues presented in the case, or the local availability of tax expertise,” before “justifies a higher rate”.

Subsec. (c)(2). Pub. L. 105–206, § 3101(b), added concluding provisions and struck out former concluding provisions which read as follows: “Such term shall only include costs incurred on or after the earlier of (i) the date of the receipt by the taxpayer of the notice of the decision of the Internal Revenue Service Office of Appeals, or (ii) the date of the notice of deficiency.”

Subsec. (c)(3). Pub. L. 105–206, § 3101(c), substituted “attorneys” for “attorney’s” in heading and amended text of par. (3) generally. Prior to amendment, text read as follows: “For purposes of paragraphs (1) and (2), fees for the services of an individual (whether or not an attorney) who is authorized to practice before the Tax Court or before the Internal Revenue Service shall be treated as fees for the services of an attorney.”

Subsec. (c)(4)(B)(iii), (iv). Pub. L. 105–206, § 3101(d), added cl. (iii) and redesignated former cl. (iii) as (iv).

Subsec. (c)(4)(D). Pub. L. 105–206, § 6014(e), substituted “subparagraph (A)(ii)” for “subparagraph (A)(iii)” in introductory provisions.

Subsec. (c)(4)(E). Pub. L. 105–206, § 3101(e)(1), added subpar. (E).

Subsec. (g). Pub. L. 105–206, § 3101(e)(2), added subsec. (g).

1997—Subsec. (b)(5). Pub. L. 105–34, § 1285(b), added par. (5).

Subsec. (c)(4)(D). Pub. L. 105–34, § 1453(a), added subpar. (D).

Subsec. (f)(2). Pub. L. 105–34, § 1285(c), substituted “the filing of a petition for review with” for “appeal to” and inserted at end “If the Secretary sends by certified or registered mail a notice of such decision to the petitioner, no proceeding in the Tax Court may be initiated under this paragraph unless such petition is filed before the 91st day after the date of such mailing.”

Subsec. (f)(3). Pub. L. 105–34, § 1285(a), added par. (3).

1996—Subsec. (b)(1). Pub. L. 104–168, § 703(a), inserted at end “Any failure to agree to an extension of the time for the assessment of any tax shall not be taken into account for purposes of determining whether the prevailing party meets the requirements of the preceding sentence.”

Subsec. (b)(3), (4). Pub. L. 104–168, § 704(a), redesignated par. (4) as (3) and struck out former par. (3) which read as follows:

“(3) Exclusion of declaratory judgment proceedings.—

“(A) In general.—No award for reasonable litigation costs may be made under subsection (a) with respect to any declaratory judgment proceeding.

“(B) Exception for section 501(c)(3) determination revocation proceedings.—Subparagraph (A) shall not apply to any proceeding which involves the revocation of a determination that the organization is described in section 501(c)(3).”

Subsec. (c)(1). Pub. L. 104–168, § 702(a)(3), inserted closing provisions “In the case of any calendar year beginning after 1996, the dollar amount referred to in clause (iii) shall be increased by an amount equal to such dollar amount multiplied by the cost-of-living adjustment determined under section 1(f)(3) for such calendar year, by substituting ‘calendar year 1995’ for ‘calendar year 1992’ in subparagraph (B) thereof. If any dollar amount after being increased under the preceding sentence is not a multiple of $10, such dollar amount shall be rounded to the nearest multiple of $10.”

Subsec. (c)(1)(B)(iii). Pub. L. 104–168, § 702(a)(1), (2), substituted “$110” for “$75” and struck out “an increase in the cost of living or” before “a special factor,”.

Subsec. (c)(2)(B). Pub. L. 104–168, § 701(c)(1), substituted “paragraph (4)(C)” for “paragraph (4)(B)”.

Subsec. (c)(4)(A). Pub. L. 104–168, § 701(a), redesignated cls. (ii) and (iii) as (i) and (ii), respectively, and struck out former cl. (i) which read as follows: “which establishes that the position of the United States in the proceeding was not substantially justified,”.

Subsec. (c)(4)(B). Pub. L. 104–168, § 701(b), added subpar. (B). Former subpar. (B) redesignated (C).

Subsec. (c)(4)(C). Pub. L. 104–168, § 701(c)(2), substituted “Any determination under this paragraph” for “Any determination under subparagraph (A)”.

Pub. L. 104–168, § 701(b), redesignated subpar. (B) as (C).

1992—Subsec. (c)(6). Pub. L. 102–572 substituted “United States Court of Federal Claims” for “United States Claims Court”.

1988—Pub. L. 100–647, § 6239(a), substituted “costs” for “court costs” in section catchline and amended text generally, revising and restating provisions so as to include costs and fees in administrative proceedings.

Subsec. (c)(2)(A)(iii). Pub. L. 100–647, § 1015(i), amended cl. (iii) generally. Prior to amendment, cl. (iii) read as follows: “meets the requirements of section 504(b)(1)(B) of title 5, United States Code (as in effect on the date of the enactment of the Tax Reform Act of 1986 and applied by taking into account the commencement of the proceeding described in subsection (a) in lieu of the initiation of the adjudication referred to in such section).”

1986—Subsec. (a). Pub. L. 99–514, § 1551(f), inserted “(payable in the case of the Tax Court in the same manner as such an award by a district court)” in concluding provisions.

Subsec. (b). Pub. L. 99–514, § 1551(a), (b), redesignated pars. (2) to (4) as (1) to (3), respectively, added par. (4), and struck out former par. (1), maximum dollar amount, which read as follows: “The amount of reasonable litigation costs which may be awarded under subsection (a) with respect to any prevailing party in any civil proceeding shall not exceed $25,000.”

Subsec. (c)(1)(A). Pub. L. 99–514, § 1551(c), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “The term ‘reasonable litigation costs’ includes—

“(i) reasonable court costs,

“(ii) the reasonable expenses of expert witnesses in connection with the civil proceeding,

“(iii) the reasonable cost of any study, analysis, engineering report, test, or project which is found by the court to be necessary for the preparation of the party’s case, and

“(iv) reasonable fees paid or incurred for the services of attorneys in connection with the civil proceeding.”

Subsec. (c)(2)(A). Pub. L. 99–514, § 1551(d), substituted “was not substantially justified” for “was unreasonable” in cl. (i), and added cl. (iii).

Subsec. (c)(4). Pub. L. 99–514, § 1551(e), added par. (4).

Subsec. (f). Pub. L. 99–514, § 1551(g), struck out subsec. (f), termination, which read as follows: “This section shall not apply to any proceeding commenced after December 31, 1985.”

1984—Subsec. (a)(2). Pub. L. 98–369 inserted reference to United States Claims Court.

Effective Date of 2017 Amendment

Amendment by Pub. L. 115–97 applicable to taxable years beginning after Dec. 31, 2017, see section 11002(e) of Pub. L. 115–97, set out as a note under section 1 of this title.

Effective Date of 1998 Amendment

Pub. L. 105–206, title III, § 3101(g), July 22, 1998, 112 Stat. 729, provided that:

Amendment by sections 6012(h) and 6014(e) of Pub. L. 105–206 effective, except as otherwise provided, as if included in the provisions of the Taxpayer Relief Act of 1997, Pub. L. 105–34, to which such amendment relates, see section 6024 of Pub. L. 105–206, set out as a note under section 1 of this title.

Effective Date of 1997 Amendment

Pub. L. 105–34, title XII, § 1285(d), Aug. 5, 1997, 111 Stat. 1039, provided that:

Pub. L. 105–34, title XIV, § 1453(b), Aug. 5, 1997, 111 Stat. 1055, provided that:

Effective Date of 1996 Amendment

Amendment by section 701(a)–(c)(2) of Pub. L. 104–168 applicable in case of proceedings commenced after July 30, 1996, see section 701(d) of Pub. L. 104–168, set out as a note under section 6404 of this title.

Pub. L. 104–168, title VII, § 702(b), July 30, 1996, 110 Stat. 1464, provided that:

Pub. L. 104–168, title VII, § 703(b), July 30, 1996, 110 Stat. 1464, provided that:

Pub. L. 104–168, title VII, § 704(b), July 30, 1996, 110 Stat. 1464, provided that:

Effective Date of 1992 Amendment

Amendment by Pub. L. 102–572 effective Oct. 29, 1992, see section 911 of Pub. L. 102–572, set out as a note under section 171 of Title 28, Judiciary and Judicial Procedure.

Effective Date of 1988 Amendment

Amendment by section 1015(i) of Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.

Pub. L. 100–647, title VI, § 6239(d), Nov. 10, 1988, 102 Stat. 3746, provided that:

Effective Date of 1986 Amendment

Pub. L. 99–514, title XV, § 1551(h), Oct. 22, 1986, 100 Stat. 2753, provided that:

Effective Date of 1984 Amendment

Amendment by Pub. L. 98–369 effective as if included in the provision of the Tax Equity and Fiscal Responsibility Act of 1982, Pub. L. 97–248, to which such amendment relates, see section 715 of Pub. L. 98–369, set out as a note under section 31 of this title.

Effective Date

Pub. L. 97–248, title II, § 292(e), Sept. 3, 1982, 96 Stat. 574, as amended by Pub. L. 98–369, div. A, title I, § 160, July 18, 1984, 98 Stat. 696, provided that: