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Endangered Federal Tax Deductions & Benefits

As Congress and President Obama head into an election year, tax reform has emerged as a key roadblock to lowering the nation’s debt — and ultimately reviving America’s economy and competitive edge.

Beginning in the Bush presidency and continuing into the Obama era, national spending and tax revenue have diverged dramatically.

“We are rapidly approaching a time when the tax system we have will be unable to support the government that we want,” said Howard Gleckman, a tax expert and resident fellow at the Urban Institute. “It’s being held together by bubble gum and baling wire.”

While much of the recent focus has been on the deficit-reduction “super committee,” Bush-era tax cuts, as well as long-in-place tax breaks, sunset at the end of 2011. Meanwhile, other established tax provisions will remain hot topics (and fair game) into the election year, as political and ideological rhetoric increases over how to reduce the nation’s budget.

We asked Gleckman, author of the Tax Policy Center’s TaxVox blog, and Dean Zerbe, national managing director at the Alliant Group and former tax counsel for the Senate Finance Committee, for their take on these tax cuts and subsidies.

Click ahead to see the most endangered tax provisions.

By Heesun Wee
Posted 05 December 2011

Photo: Getty Images