On September 16, 2020, the Department issued an assessment to the Taxpayer for gross receipts tax for years 2015 to 2017. On December 15, 2020, the Taxpayer filed a protest of the assessment. Later, the Taxpayer filed supplemental protest, claiming that the assessment was erroneous and illegal and that he was entitled to be reimburses for attorney’s fees. The Taxpayer had discussed with the Department previously the issue that had made the Department believe that gross receipt tax was owed. The Taxpayer’s wife, an attorney, had been issued 1099s that incorrectly stated the Taxpayer received compensation instead of his wife. After having received an intent to assess from the Department, the Taxpayer provided information about the corrected 1099s to an auditor who acknowledged that the amount assessed was not subject to gross receipts. Later, however, the Department still assessed the Taxpayer for gross receipts tax. Though the Department later abated the amount assessed in full, the Taxpayer claimed that the Department was liable for costs he incurred contesting the assessment in which he was the prevailing party. Under statute, a Taxpayer may be awarded reasonable administrative costs when they are the prevailing party in a protest, but not if the Department’s position was based on a reasonable application of law to the facts. In this case, however, the Hearing Officer determined that the assessment was not a reasonable application of the facts because the Department had clear evidence that the assessment was wrong. Because the assessment was found to be unreasonable, the Hearing Officer granted the protest and ordered the Department to compensate the Taxpayer for the legal costs.