Top tax breaks for individuals

Top tax breaks for individuals

Associated Press

U.S. tax law is filled with so many credits, deductions and exemptions that Americans will be able to reduce their tax bills by about $1.1 trillion this year, according to congressional estimates.

The biggest tax breaks, and the amount they will save taxpayers this year:

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—Employer contributions toward workers' medical insurance premiums and medical care are not taxed: $181 billion.

—Retirement plan contributions and earnings are not taxed: $165 billion.

—Mortgage interest deduction: $101 billion.

—Lower tax rates on long-term capital gains and qualified dividends: $84 billion.

—Deduction for state and local taxes: $69 billion.

—Deduction for charitable contributions: $46 billion.

—Most Social Security and veterans' benefits are not taxed: $45 billion.

—Interest on tax-exempt state and local government bonds is not taxed: $26 billion.

—When someone dies, the capital gains on his investments is not taxed: $24 billion.

—Income from some life insurance products is not taxed: $23 billion.

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Sources: National Taxpayer Advocate; Joint Committee on Taxation.

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