Saturday, July 22, 2017

Your mortgage interest deduction is only eighth in the latest list of top things on which government claims it loses revenue

But libertarians especially hate it. Expect more articles telling you it's got to go as tax reform talk heats up in Congress.

Here are the top 20 "tax loss expenditures" for 2016-2020:

1.  Exclusion of employer contributions for health care and insurance: $863 billion
2.  Lower tax rates on dividends and long term capital gains: $678 billion
3.  Income made by controlled foreign corporations: $587 billion
4.  Contributions made to IRAs and 401k plans: $584 billion
5.  Pension plan contributions: $424 billion
6.  Earned Income Tax Credit: $373 billion
7.  Deductions taken for state and local income taxes, sales taxes, property taxes: $369 billion
8.  Deductions taken for mortgage interest on owner occupied homes: $357 billion
9.  Obamacare "subsidies": $327 billion (what a laugh: they raise the cost, give you a subsidy, and count the subsidy as a tax-free gift)
10. Child tax credit: $271 billion
11. Expensing depreciable business property: $248 billion
12. Deductions taken for charitable contributions: $231 billion
13. Social Security benefits: $214 billion
14. Municipal bond income: $195 billion
15. Deductions taken for taxes on real property: $180 billion
16. Capital gains taxes excluded at death: $179 billion
17. Medical expenses and over the counter medications under cafeteria plans: $169 billion
18. Capital gains taxes excluded on sale of principal residence: $166 billion
19. Life insurance proceeds: $128 billion
20. Deduction for income from domestic production activities: $102 billion.

Total revenue the government claims it's "losing" because of its "benevolent" tax policy on these items: $6.645 trillion over five years, or $1.329 trillion annually.

My, how nice of them. 

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