A bill for an act relating to awarding the costs in administrative hearings or court proceedings involving the collection of tax, penalties, and interest by the department of revenue.

This bill changes Iowa's rules for who pays legal costs when taxpayers challenge tax assessments. It removes the $25,000 cap on recoverable costs and allows winning taxpayers to get reimbursement for reasonable court fees, expert witness costs, necessary studies, and attorney/accountant fees. The bill shifts the burden of proof: if a taxpayer substantially wins on the amount or key issues, the Department of Revenue must prove its position was "substantially justified" to avoid paying costs. This directly affects taxpayers contesting tax, penalty, or interest collections through administrative hearings or court.