Table 1

Eighteen Largest Individual Income Tax Expenditures

Tax Expenditure Amount (billion $)
Exclusion of employer provided health benefits 143
Exclusion of pension and IRA contributions and earnings 127.2
Reduced rates on capital gains and dividends 91.3
Mortgage interest deduction 71.7
Earned income tax credit 67
Exclusion of Medicare benefits 66
Child tax credit 57.9
Deduction for state and local taxes 51.8
Exclusion of capital gains at death 48.4
Charitable contribution deduction 43.6
Exclusion of benefits under cafeteria plans 36.6
Exclusion of untaxed Social Security benefits 34.4
Property tax deduction 28.6
Exclusion of investment income on life insurance and annuity contracts 28
Exclusion of interest on state and local government bonds 27.3
Exclusion of capital gains on sales of principal residence 24.8
Post-secondary education tuition credit 24.5
Subsidies for participation in exchanges 20.5

Source: Joint Committee on Taxation, Estimates of Federal Tax Expenditures for Fiscal Years 2012-2017, JCS-1-13, February 1, 2013.

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