Changes in Tax Deductions Likely to Affect Wealthiest Americans
By: Big 2 News Staff
Updated: December 11, 2012
A potential tax rate hike for the wealthy isn't the only reason America's top
wage earners could be paying more in taxes next year.
A new CNN Money analysis shows a limit on itemized deductions would overwhelmingly affect the wealthy.
The analysis shows their tax burdens would go up by an average of $14,000 each year.
The reason for that is simple: taxpayers who earn $250,000 or more each year almost always itemize their taxes.
The analysis of IRS data shows nearly 97% of those Americans itemize their taxes.
The number is much less for those in the $30,000 to $50,000 bracket; less than 30% of them itemize.
The most popular deduction among wealthier Americans was for state and local income taxes.
Meanwhile, home mortgage interest is a popular deduction among middle-class taxpayers.
A new CNN Money analysis shows a limit on itemized deductions would overwhelmingly affect the wealthy.
The analysis shows their tax burdens would go up by an average of $14,000 each year.
The reason for that is simple: taxpayers who earn $250,000 or more each year almost always itemize their taxes.
The analysis of IRS data shows nearly 97% of those Americans itemize their taxes.
The number is much less for those in the $30,000 to $50,000 bracket; less than 30% of them itemize.
The most popular deduction among wealthier Americans was for state and local income taxes.
Meanwhile, home mortgage interest is a popular deduction among middle-class taxpayers.
