Congress allows a range of tax breaks to expire every year. Certain tax breaks refer to such a small segment of the population that very few people notice their disappearance. On the other hand, some tax breaks are widely missed and we are going to describe with detail some of them here.
State and Local Sales Taxes
The tax break for state and local sales taxes is disappearing. This tax break amounted to close to $7 billion in funds which taxpayers were able to keep. This may lead to rising prices, or at the very least more struggling businesses.
School Teacher Supplies Deduction
This tax deduction applies to teachers who pay for classroom supplies from their pockets. This affects us all because teachers are less likely to open their wallets to supply their schools. Naturally, lesson quality will decline as a result.
Mass Transit and Parking Benefits
If you commute to work, or own a small business, you are going to feel the pinch. Those transit and parking benefits are not tax deductible any longer.
Mortgage Debt Exclusion
Exclusions for mortgage debts are another vanishing tax deductible. This is particularly important in a nation which is experiencing a record number of foreclosures. Some pundits claim it could contribute to an increasing number of foreclosed homes in the coming years.
Why Do They Expire?
Contrary to popular belief, tax benefits do not expire due to the government having an intention to let them expire. It is because of the divisions within congress. There is a chance these tax breaks will come back, but certainly not for at least another year.
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