Exclusions to Income Tax in 2008 (in billions)
The following list includes provisions of fed-eral tax law that allow special exclusions,
exemptions, or deductions from a person’s gross income tax, which provides a special credit leading to a revenue loss or “tax expenditure” for the federal government:
Tax law provisions Revenue lost in billions
Pension contributions $141
Reduced tax rates on dividends and long-term $128
capital gains
Exclusion for employer contributions for health
care insurance premiums $117
Mortgage interest deduction $80
Exclusion of capital gains at death $54
Earned income tax credit $47
Tax credit for children under 17 $45
Deduction for charitable contributions $35
Deduction of state, local, and property taxes $30
Total $677 billion
Source: Joint Committee on Taxation, 2008