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.

SSB 1005 changes Iowa's tax dispute rules to help taxpayers who win cases against the Department of Revenue. It removes the current $25,000 cap on recoverable costs and allows winning taxpayers to get reasonable costs for expert witnesses, necessary studies or reports, and attorney or accountant fees based on market rates. The bill shifts the burden of proof: if a taxpayer substantially prevails on the amount in dispute or key issues, the Department must prove its position was "substantially justified" to avoid paying these costs. This directly affects taxpayers challenging tax assessments, penalties, or interest collections in administrative hearings or court.