Tax Expenditures and Employee Benefits: Estimates from the FY 2007 Budget

Abstract:     
The federal government supports the provision of employee benefits through preferential tax treatment in the Internal Revenue Code. There are three types of tax treatments for employee benefits: tax exemption, tax deferral, and other preferential treatment. The Congressional Budget Act of 1974 (P.L. 93-344) requires that a list of tax expenditures (federal tax revenue forgone due to preferential provisions) be included in the budget. This paper includes a listing of the employee benefits tax expenditures, as published in President Bush's Fiscal Year 2007 budget, prepared by the White House Office of Management and Budget, using a methodology that is flawed but mandated by Congress.

Number of Pages in PDF File: 12

Keywords: Employment-based benefits, Tax expenditures, United States budget

JEL Classification: E62, H61

Accepted Paper Series