What Writeoffs Might Die in Senate's Tax Code Overhaul
Max Baucus and Orrin Hatch trying 'blank slate' approach
By Kevin Spak, Newser User
Posted Jul 11, 2013 10:30 AM CDT
   (Shutterstock)

(Newser) – Don't look now, but the Senate is sort of rewriting the entire tax code. Max Baucus and Orrin Hatch are trying an ambitious "blank slate" approach to the code, throwing out every tax provision and putting the onus on their supporters to justify their continued existence—and they have just 15 days left to do it. So Politico decided to point out the most significant potential casualties in the purge:

  • The mortgage interest deduction: It's currently the government's biggest tax expenditure, and it subsidizes homes that cost up to $1 million. "That's crazy," one tax expert said. Lawmakers are considering cutting that cap in half, but realty lobbyists will surely argue that the housing rebound is too fragile.
  • Carried interest: This is the provision that lets Wall Street types like Mitt Romney pay the much lower capital gains tax on their income instead of normal income tax. But Democrats have been trying to kill it for years with little success.
  • The wind production credit: Any break Republicans oppose is especially vulnerable, and this is one of them. It was already supposed to lapse last year, but was revived as part of the fiscal cliff deal.
  • Corporate jets: Democrats have been hammering this tax break for years, believing that it's political gold. The actual break just allows corporations to write off jets faster than other kinds of aircraft, and lobbyists will surely argue that killing it will hurt manufacturers.
For more on each deduction, and one more we left out, check the source.

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Showing 3 of 44 comments
Lefty_Libby
Jul 11, 2013 11:47 PM CDT
Many of the people who can afford million dollar plus homes buy them with cash and hold them in trust, ergo the mortgage interest deduction doesn't apply to them. BTW, I thought that rat Baucus was leaving. Can't he please go without doing anymore damage to the middle and lower class people of this country. Besides, he'll reincarnate as some damned lobbyist anyhow.
UMTigerFan
Jul 11, 2013 7:16 PM CDT
Taxes are paid by the citizens of the country. Allowing citizens to keep more of the money they earn is NOT an expenditure, it's a tax. Spending cuts do not have to be paid for! The government should fund programs authorized by the constitution (Post Offices, which they abdicated, Military, Treasury) and get out of the business of funding education (Local / state funded), Agriculture (again, local / state regulation), Arts (let the admirer's of the art pay for it). Why is it greedy to want to keep what you earn, but ok to want to take what other people earn. And the operative word here is EARN. Fair Tax Now!
Mr.LarryG.
Jul 11, 2013 2:24 PM CDT
the improvement in home sales and new home building will be dramatically halted if interest deductions are eliminated or severed,,,,let that one alone, or at least only affect homes of 1 million or more,,,,the middle class has paid enuff,,,,