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Last updated: February 20. 2013 1:54AM - 111 Views

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By The Associated Press



U.S. tax law is filled with so many credits, deductions and exemptions that Americans will be able to reduce their tax bills by about $1.1 trillion this year, according to congressional estimates.


The biggest tax breaks, and the amount they will save taxpayers this year:


• Employer contributions toward workers' medical insurance premiums and medical care are not taxed: $181 billion.


• Retirement plan contributions and earnings are not taxed: $165 billion.


• Mortgage interest deduction: $101 billion.


• Lower tax rates on long-term capital gains and qualified dividends: $84 billion.


• Deduction for state and local taxes: $69 billion.


• Deduction for charitable contributions: $46 billion.


• Most Social Security and veterans' benefits are not taxed: $45 billion.


• Interest on tax-exempt state and local government bonds is not taxed: $26 billion.


• When someone dies, the capital gains on his investments is not taxed: $24 billion.


• Income from some life insurance products is not taxed: $23 billion.




Sources: National Taxpayer Advocate; Joint Committee on Taxation.


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