tax policy center

Tax Topics

2009 Tax Stimulus
2012 Election Tax Plans
2015 Budget
Alternative Minimum Tax (AMT)
American Jobs Act of 2011
Brief Description of the Model 2015
Camp Tax Reform Plan
Current-Law Distribution of Taxes
Deficit Reduction Proposals
Distribution of the 2001 - 2008 Tax Cuts
Dynamic Scoring
Earned Income Tax Credit
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Estate and Gift Taxes
Expiration of the Bush Tax Cuts
Explanation of Income Measures 2013
Federal Budget
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Guide to TPC Tables
Health Insurance Tax Incentives
How to Interpret Distribution Tables 2013
Marriage Penalties
Model FAQ 2013
Model Related Resources and FAQs
Payroll Taxes
Presidential Transition - 2009
Recent Tax Stimulus Legislation
Retirement Saving
Tax Encyclopedia Index
Tax Expenditures
Tax Reform Proposals
TPC’s Methodology for “Off-Model” Revenue Estimates
Value-Added Tax (VAT)
Who Doesn't Pay Federal Taxes?
Working Families

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tax topics
Distribution of Individual Income Tax Expenditures

View TPC's Tax Topics page on tax expenditures.

Tax expenditures are revenue losses attributable to tax provisions that often result from the use of the tax code to promote social goals without incurring direct expenditures. Tax expenditures are implemented within the tax code primarily through the deduction of expenses, exclusion of certain income from the tax base, refundable and non-refundable credits that directly reduce tax liability, and reduced tax rates on income from specific sources. In many cases, tax expenditures are the equivalent of spending programs carried out through the tax code.

The Tax Reform Act of 1986 substantially reduced federal tax expenditures but Congress has added more tax expenditures over the intervening 25 years. Between 1990 and 2010, non-business tax expenditures grew from 4.6 percent of GDP to 6.5 percent.

The Tax Policy Center has estimated the distribution of individual income tax expenditures and examined options to restructure and reform individual tax expenditures or limit the aggregate benefits from tax expenditures to high-income taxpayers.

Distributional Analysis