Itemized deduction advantage
Itemized deduction advantage
Itemized deductions have long helped reduce the tax bills of the rich more than those of other Americans. The wealthy are often subject to higher tax rates, so deducting these items from their income gives them a bigger benefit.

Washington sweetened this break in recent years. Through 2012, the rich can take the full value of these itemized deductions regardless of their income.

Some 96% of those making between $200,000 and $1 million itemized their deductions on their 2009 return, rather than taking the standard deduction of $5,700 for single taxpayers or $11,400 for married couples. Meanwhile, only 37% of those making between $40,000 and $50,000 itemized their deductions.

Of those making $200,000 to $1 million, some 90% claimed a charitable tax deduction on their 2009 return, according to the IRS. Their contributions were just over $9,000 on average. Some 79% of these folks took a deduction for home mortgage interest, with the average deduction coming in at $21,350.

But only 28% of those making between $40,000 and $50,000 took a charitable deduction for donations, with the average contribution less than $2,400. Some 28% deducted their home mortgage interest, with the average deduction working out to just under $8,800.


By Tami Luhby @CNNMoney - Last updated February 15 2012: 9:58 AM ET
Government assistance expands

More than a third of Americans lived in households receiving government assistance in mid-2010.

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