RULE 232. DISPOSITION OF CLAIMS FOR LITIGATION AND ADMINISTRATIVE COSTS
- (a) General: A motion for reasonable litigation or
administrative costs may be disposed of in one or more of the
following ways, in the discretion of the Court:
- (1) The Court may take action after the Commissioner's written
response to the motion is filed. (See paragraph (b).)
- (2) After the Commissioner's response is filed, the Court may
direct that the moving party file a reply to the Commissioner's
response. Additionally, the Court may direct a hearing, which will
be held at a location that serves the convenience of the parties
and the Court. A motion for reasonable litigation or administrative
costs ordinarily will be disposed of without a hearing unless it is
clear from the motion, the Commissioner's written response, and the
moving party's reply that there is a bona fide factual dispute that
cannot be resolved without an evidentiary hearing.
- (b) Response by the Commissioner: The Commissioner shall file
a written response, within 60 days after service of the motion. The
Commissioner's response shall contain the following:
- (1) A clear and concise statement of each reason why the
Commissioner alleges that the position of the Commissioner in the
Court proceeding and, if the claim includes a claim for
administrative costs, in the administrative proceeding, was
substantially justified, and a statement of the facts on which the
the Commissioner relies to support each of such reasons;
- 1(2) A statement whether the Commissioner agrees
that the moving party has substantially prevailed with respect
to either the amount in controversy or the most significant
issue or set of issues presented, or is treated as the
prevailing party in the case of a qualified offer made as described
in Code section 7430(g), either in the Court proceeding
or, if the claim includes a claim for administrative
costs, in the administrative proceeding;
- (3) A statement whether the Commissioner agrees that the moving
party meets the net worth requirements, if applicable, as provided
by law;
- (4) A statement whether the Commissioner agrees that the moving
party has exhausted the administrative remedies available to such
party within the Internal Revenue Service;
- (5) A statement whether the Commissioner agrees that the moving
party has not unreasonably protracted the Court proceeding and, if
the claim includes a claim for administrative costs, the
administrative proceeding;
- (6) A statement whether the Commissioner agrees that the amount
of costs claimed is reasonable; and
- (7) The basis for the Commissioner's disagreeing with any such
allegations by the moving party.
- If the Commissioner agrees with the moving party's request for
a hearing, or if the Commissioner requests a hearing, then such
response shall include a statement of the Commissioner's reasons
why the motion cannot be disposed of without a hearing.
- (c) Conference Required:. After the date for filing
Commissioner's written response and prior to the date for filing a
reply, if one is required by the Court, counsel for the
Commissioner and the moving party or counsel for the moving party
shall confer and attempt to reach an agreement as to each of the
allegations by the moving parties. The Court expects that, at such
conference, the moving party or counsel for the moving party shall
make available to counsel for the Commissioner substantially the
same information relating to any claim for attorney's fees which,
in the absence of an agreement, the moving party would be required
to file with the Court pursuant to paragraph (d) of this Rule.
- (d) Additional Affidavit: Where the Commissioner's response
indicates that the Commissioner and the moving party are unable to
agree as to the amount of attorney's fees which is reasonable,
counsel for the moving party shall, within 30 days after service of
the Commissioner's response, file an additional affidavit which
shall include:
- (1) A detailed summary of the time expended by each individual
for whom fees are sought, including a description of the nature of
the services performed during each period of time summarized. Each
such individual is expected to maintain contemporaneous, complete,
and standardized time records which accurately reflect the work
done by such individual. Where the reasonableness of the hours
claimed becomes an issue, counsel is expected to make such time
records available for inspection by the Court or by counsel for the
Commissioner upon request.
- (2) The customary fee for the type of work involved. Counsel
shall provide specific evidence of the prevailing community rate
for the type of work involved as well as specific evidence of
counsel's actual billing practice during the time period involved.
Counsel may establish the prevailing community rate by affidavits
of other counsel with similar qualifications reciting the precise
fees they have received from clients in comparable cases, by
evidence of recent fees awarded by the courts or through settlement
to counsel of comparable reputation and experience performing
similar work, or by reliable legal publications.
- (3) A description of the fee arrangement with the client. If
any part of the fee is payable only on condition that the Court
award such fee, the description shall specifically so state.
- (4) The preclusion of other employment by counsel, if any, due
to acceptance of the case.
- (5) Any time limitations imposed by the client or by the
circumstances.
- (6) Any other problems resulting from the acceptance of the
case.
- (7) The professional qualifications and experience of each
individual for whom fees are sought.
- (8) The nature and length of the professional relationship
with the client.
- (9) Awards in similar cases, if any.
- 1(10) AA statement whether there is a special factor,
such as the limited availability of qualified attorneys for
the case, the difficulty of the issues presented in the case,
or the local availability of tax expertise, to justify a rate in
excess of the rate otherwise permitted for the services of
attorneys under Code section 7430(c)(1).
- (11) Any other information counsel believes will assist the
Court in evaluating counsel's claim, which may include, but shall
not be limited to, information relating to the novelty and
difficulty of the questions presented, the skill required to
perform the legal services properly, and any efforts to settle the
case.
- Where there are several counsel of record, all of whom are
members of or associated with the same firm, an affidavit filed by
first counsel of record or that counsel's designee (see Rule 21(b)(2)) shall satisfy the requirements of
this paragraph, and an affidavit by each counsel of record shall
not be required.
- 2(e) Burden of Proof: The moving party shall have the
burden of proving that the moving party has substantially
prevailed or is treated as the prevailing party in the case of
a qualified offer made as described in Code section 7430(g),
that the moving party has exhausted the administrative remedies
available to the moving party within the Internal Revenue
Service, that the moving party has not unreasonably protracted
the Court proceeding or, if the claim includes a claim
for administrative costs, the administrative proceeding, that
the moving party meets the net worth requirements, if applicable,
as provided by law, that the amount of costs claimed
is reasonable, and that the moving party has substantially
prevailed with respect to either the amount in controversy or
the most significant issue or set of issues presented either in
the Court proceeding or, if the claim includes a claim for administrative
costs, in the administrative proceeding; except
that the moving party shall not be treated as the prevailing party if the Commissioner establishes that the position of the
Commissioner was substantially justified. See Code sec.
7430(c)(4)(B).
- (f) Disposition: The Court's disposition of a motion for
reasonable litigation or administrative costs shall be included in
the decision entered in the case. Where the Court in its opinion
states that the decision will be entered under Rule 155, or where the parties have settled all
of the issues other than litigation and administrative costs, the
Court will issue an order granting or denying the motion and
determining the amount of reasonable litigation and administrative
costs, if any, to be awarded. The parties, or either of them, shall
thereafter submit a proposed decision including an award of any
such costs, or a denial thereof, for entry by the Court.
1 The amendment is effective with respect to costs incurred and services
performed after January 18, 1999.
1The amendment is effective with respect to costs incurred and services
performed after January 18, 1999.
2The amendment is effective with respect to costs incurred and services
performed after January 18, 1999.
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