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Additional Standard Tax Deduction for the Blind: A Description and Assessment, May 7, 2008 1 (May 7, 2008)

handle is hein.tera/crstax0074 and id is 1 raw text is: Order Code RS2055,1 Updated May 7, 200 ACRS Report for Congress Additional Standard Tax Deduction for the Blind: A Description and Assessment Pamela J. Jackson Specialist in Public Finance Government and Finance Division Jennifer Teefy Information Research Specialist Knowledge Services Group Summary In the Revenue Act of 1943, a special $500 income tax deduction was first permitted the blind for expenses directly associated with readers and guides. This deduction for expenses evolved to a $600 personal exemption in the Revenue Act of 1948 so that the blind did not forfeit use of the standard deduction and so that the tax benefit could be reflected directly in the withholding tables. Congress attempted to target the tax benefit to low- and moderate-income blind individuals by replacing the tax exemption with an additional standard deduction amount with passage of the Tax Reform Act of 1986. The extra standard deduction amount provides tax relief that recognizes the increased costs of living and associated costs of employment for blind taxpayers. Since many blind taxpayers have low incomes, they are able to use the additional standard deduction amount provided under current tax law. However, this extra amount arguably does not meet the tax tests of horizontal equity and effectiveness. The provision has not been extended to other taxpayers with handicapping conditions because of administrative difficulties and the loss of additional federal tax revenues. This report will be updated in future years to reflect changes in law or in the additional standard deduction amount that is adjusted for inflation. Current Tax Law Federal income tax laws provide certain allowances for the blind, the most important of which is the additional standard deduction amount allowed to legally blind taxpayers. Other special tax allowances are included in other provisions of the law, such as the exception from the 2% floor for deducting employee business expenses for impairment- Congressional Research Service The Library of Congress Prepared for Members and Committees of Congress

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