This article addresses the question of whether income tax deductions are mandatory, or may be waived by the taxpayer when doing so generates a tax or non-tax benefit. What little authority exists suggests that deductions are optional except in two specific instances related to the computation of net earnings from self-employment. The increasing number of taxpayers subject to the alternative minimum tax, the amount of which can be reduced in many instances by foregoing deductions, makes it very likely that the question will reach the courts in the near future. This article concludes that aside from the two specific instances for which there is authority making certain deductions mandatory, the few IRS and judicial decisions touching on the matter do not require taxpayers to claim available deductions.
Legislation | Taxation-Federal Estate and Gift
Date of this Version
Maule, James Edward, "No Thanks, Uncle Sam, You Can Keep Your Tax Break" (2006). Working Paper Series. 58.