Tax Breaks Are Heavily Tilted Toward High Income Taxpayers
|Sunday, 18 September 2011 14:34|
The Post had a front page column reporting on the cost of tax breaks. The piece likely gave many readers a misleading picture of the main beneficiaries of these tax cuts when it told readers that:
"the bulk went to private households, primarily upper-middle-class families that Obama has vowed to protect from new taxes.'The big money is in the middle-class subsidies,' said Syracuse University economist Leonard Burman, former director of the nonpartisan Tax Policy Center."
In fact, by far the largest beneficiaries of these tax cuts are upper income individuals as the chart accompanying the piece shows. For example, tax breaks amount to average of $82,400 for families with income between $500,000 and $1,000,000. Close to 70 percent of the mortgage interest deduction goes to families with incomes above $100,000 a year.
These tax breaks tend to be worth less to more moderate income families since in most cases they do not amount to much more than the standard deduction. That means that most families near the median income (@$60,000) see little benefit from these tax breaks.