Tax expenditures are revenue losses attributable to tax provisions that often result from the use of the tax system to promote social goals without incurring direct expenditures. How tax expenditures are structured affects both who will benefit from them and how much they will reduce federal revenues.

Background Information

Briefing Book entries on Tax Expenditures:

• What are they and how are they structured?
• What is a tax expenditure budget?
• Why are they controversial?
• How have they changed over time?
• What are the largest tax expenditures?

Tax Encyclopedia entry: Tax Expenditures

TPC Distribution Tables

• View TPC's Distributional Analysis of Individual Income Tax Expenditures 

TPC Papers

“How Large Are Tax Expenditures? A 2012 Update,” Donald Marron (Tax Notes, April 9, 2012)

“How Big is the Federal Government?” Donald Marron and Eric Toder (TPC paper presented at National Tax Association Meetings on November 17, 2012; paper published March 26, 2012)

“Distributional Effects of Individual Income Tax Expenditures: An Update,” Eric Toder and Daniel Baneman (TPC paper presented at National Tax Association Meetings on November 18, 2012; paper published February 2, 2012)

“Curbing Tax Expenditures,” Daniel Baneman, Joseph Rosenberg, Eric Toder and Roberton Williams (TPC paper presented at Baker Institute conference on October 5-6, 2011; paper published January 30, 2012)

“Trends in Tax Expenditures, 1985-2016,” Allison Rogers and Eric Toder (Tax Policy Center, September 16, 2011)

“Options to Reform the Deduction for Home Mortgage Interest,” Daniel Baneman, Hang Nguyen, Jeffrey Rohaly and Eric Toder (Tax Policy Center, August 16, 2011)

“Options to Limit the Benefit of Tax Expenditures for High Income Households,” Daniel Baneman, Jim Nunns, Jeff Rohaly, Eric Toder and Roberton Williams (Tax Policy Center, August 2, 2011)

“Spending in Disguise,” Donald B. Marron (National Affairs, June 28, 2011)

“Government Spending Undercover: Spending Programs Administered by the IRS,” Lily L. Batchelder and Eric Toder (Center for American Progress, April 22, 2010)

“Tax Expenditure Framework Legislation,” Edward D. Kleinbard (presented at “Train Wreck: A Conference on America's Looming Fiscal Crisis,” January 15, 2010)

“Distributional Effects of Tax Expenditures,” Eric J. Toder, Benjamin H. Harris, and Katherine Lim (TPC Research Report, July 21, 2009)

“How Big Are Total Individual Income Tax Expenditures, and Who Benefits from Them?” Eric Toder, Leonard E. Burman, and Christopher Geissler (TPC Discussion Paper 31, December 4, 2008)

“Eliminating Tax Expenditures with Adverse Environmental Effects,” Eric Toder (May 31, 2007)

Commentary

“Let's freeze more than chump change,” Leonard E. Burman (Washington Post, February 2, 2010)

“Don't Ignore Tax Expenditures,” Leonard E. Burman (Marketplace commentary, March 2, 2005)

“Summers on Social Tax Expenditures,” C. Eugene Steuerle

• Part One: “Where He's Right” (Tax Notes, December 11, 2000)
• Part Two: “Part Two: Where He's Wrong...or at Least Incomplete” (Tax Notes, December 18, 2000)

TaxVox Posts

• Why Do People Pay No Federal Income Tax (July 27, 2011)
• Tom Coburn: Tax Subsidies are Socialism (July 19, 2011)
• Let's Bribe Taxpayers To Give Up Tax Breaks (June 17, 2011)
• How Not To Fix The Housing Market (May 16, 2011)
• Spending Caps, Medicare Vouchers, and Magical Thinking (May 10, 2011)
• Who Pays No Income Tax? It is the Wrong Question (May 5, 2011)
• Tax Expenditures are not Loopholes (April 22, 2011)
• The Supreme Court Says Tax Expenditures Aren't Government Spending (April 7, 2011)

Tax Facts

• “Who Benefits from Tax Expenditures?” Roberton Williams, (Tax Notes, May 4, 2011)
• “How Large are Tax Expenditures?” Donald Marron (Tax Notes, March 30, 2011)
• “The Trend in Federal Housing Tax Expenditures,” Adam Carasso, C. Eugene Steuerle, and Elizabeth Bell (Tax Notes, February 28, 2005)
• Projected Income Tax Expenditure Budget 2001-2016 (Department of the Treasury, 2012 Budget)
• Joint Committee on Taxation estimates of tax expenditures