Section 7-1-29.1 - Awarding of costs and feesA. In an administrative proceeding or court proceeding brought by or against a taxpayer and conducted in connection with the determination, collection or refund of a tax or the interest or penalty for a tax governed by the Tax Administration Act, the taxpayer shall be awarded a judgment or a settlement for reasonable administrative costs and reasonable litigation costs and attorney fees incurred in connection with the proceeding if the taxpayer is the prevailing party.B. As used in this section: (1) "administrative proceeding" means any procedure or other action before the department or the administrative hearings office;(2) "court proceeding" means any civil action brought in state district court;(3) "reasonable administrative costs" means: (a) any administrative fees or similar charges imposed by the department or the administrative hearings office; and(b) actual charges for: 1) filing fees, court reporter fees, service of process fees and similar expenses; 2) the services of expert witnesses; 3) any study, analysis, report, test or project reasonably necessary for the preparation of the party's case; and 4) fees and costs paid or incurred for the services in connection with the proceeding of attorneys, certified public accountants, employees of a New Mexico licensed certified public accounting firm or enrolled agents who are authorized to practice in the context of an administrative proceeding; and(4) "reasonable litigation costs and attorney fees" means:(a) reasonable court costs; and(b) actual charges for: 1) filing fees, court reporter fees, service of process fees and similar expenses; 2) the services of expert witnesses; 3) any study, analysis, report, test or project reasonably necessary for the preparation of the party's case; and 4) fees and costs paid or incurred for the services of attorneys in connection with the proceeding.C. For purposes of this section: (1) the taxpayer is the prevailing party if the taxpayer has:(a) substantially prevailed with respect to the amount in controversy; or(b) substantially prevailed with respect to most of the issues involved in the case or the most significant issue or set of issues involved in the case;(2) the taxpayer is not the prevailing party if the administrative hearings office finds that the position of the department in the proceeding was based upon a reasonable application of the law to the facts of the case. For purposes of this paragraph, the position of the department shall be presumed not to be based upon a reasonable application of the law to the facts of the case if:(a) the department did not follow applicable published guidance in the proceeding; or(b) the assessment giving rise to the proceeding is not supported by substantial evidence determined at the time of the issuance of the assessment;(3) as used in Subparagraph (a) of Paragraph (2) of this subsection, "applicable published guidance" means: (a) department or administrative hearings office regulations, information releases, instructions, notices, technical advice memoranda and announcements; and(b) private letter rulings and letters issued by the department to the taxpayer; and(4) the determination of whether the taxpayer is the prevailing party and the amount of reasonable litigation costs or reasonable administrative costs shall be made by agreement of the parties or: (a) in the case of an administrative proceeding, by the hearing officer; or(b) in the case of a court proceeding, by the court.D. An order granting or denying in whole or in part an award for: (1) reasonable litigation costs and attorney fees pursuant to Subsection A of this section in a court proceeding may be incorporated as a part of the court's decision or judgment and are subject to appeal in the same manner as the decision or judgment; and(2) reasonable administrative costs pursuant to Subsection A of this section in an administrative proceeding are reviewable in the same manner as a decision of the administrative hearings office.E. An agreement for or award of reasonable administrative costs or reasonable litigation costs in any administrative proceeding or court proceeding pursuant to Subsection A of this section shall not exceed the lesser of twenty percent of the amount of the settlement or judgment or seventy-five thousand dollars ($75,000).F. The department shall annually report to the legislative finance committee and the revenue stabilization and tax policy committee on the costs it incurs pursuant to this section.1978 Comp., § 7-1-29.1, enacted by Laws 2003, ch. 398, § 12; 2015, ch. 73, § 18.Amended by 2019, c. 157,s. 5, eff. 6/14/2019.Amended by 2015, c. 73,s. 18, eff. 7/1/2015.