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The Genesis of Senior Income Tax Breaks


  • Conway, Karen Smith
  • Rork, Jonathan C.


This article conducts two investigations — searching historical documents and testing the conclusions drawn with an econometric model of policy adoption — into why federal and state governments began offering senior income tax breaks. Such tax breaks began by accident but their existence justified additional breaks. The two main breaks — the aged and the "pension" income exemptions — evolved under different, unrelated processes. The federal government initiated the aged exemption in part to address the high post-war cost of living, and the states followed. Conversely, pension exemptions were initiated by the states, did not become common until the 1970s, and have evolved into weapons of state policy competition.

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  • Conway, Karen Smith & Rork, Jonathan C., 2012. "The Genesis of Senior Income Tax Breaks," National Tax Journal, National Tax Association, vol. 65(4), pages 1043-1068, December.
  • Handle: RePEc:ntj:journl:v:65:y:2012:i:4:p:1043-68

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    References listed on IDEAS

    1. C. Harry Kahn, 1960. "Personal Deductions in the Federal Income Tax," NBER Books, National Bureau of Economic Research, Inc, number kahn60-1, January.
    2. Jon Bakija, 2006. "Documentation for a Comprehensive Historical U.S. Federal and State Income Tax Calculator Program," Department of Economics Working Papers 2006-02, Department of Economics, Williams College, revised Aug 2009.
    3. Jonathan Skinner & Douglas Staiger, 2007. "Technology Adoption from Hybrid Corn to Beta-Blockers," NBER Chapters,in: Hard-to-Measure Goods and Services: Essays in Honor of Zvi Griliches, pages 545-570 National Bureau of Economic Research, Inc.
    4. Dora L. Costa, 1998. "The Evolution of Retirement: An American Economic History, 1880-1990," NBER Books, National Bureau of Economic Research, Inc, number cost98-1, January.
    5. Rork, Jonathan C., 2005. "Getting What You Pay For: The Case of Southern Economic Development," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 35(2).
    6. Friedberg, Leora, 1999. "The effect of old age assistance on retirement," Journal of Public Economics, Elsevier, vol. 71(2), pages 213-232, February.
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