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Romney suggests overall itemized tax deduction limit of $17,000

We finally have some tax plan specifics from Mitt Romney.


In advance of tonight's debate in the Mile High City, the Republican presidential candidate told Denver Fox affiliate KDVR that one way to pay for his 20 percent across-the-board income tax rate cuts would be to limit a filer's deduction amount to $17,000.

"As an option, you could say everybody's going to get up to a $17,000 deduction," Romney said. "And you could use your charitable deduction, your home mortgage deduction, or others -- your health care deduction -- and you can fill that bucket, if you will, that $17,000 bucket that way."

Lobbyists for groups that might be affected by a limit on deductions are no doubt working on their arguments against any changes that could cost them.

But fans of tax simplification, which is what every politician for every federal office says is his or her ultimate goal, view the reduction of tax breaks as a good step.

Tell us more: But please, Mr. Romney, could we have some more tax plan information?

Romney obviously is talking about itemized deductions here since he mentions two very popular Schedule A write-offs.

Is he then saying that all the itemized deductions we now can claim will remain under a Romney Administration? Or will he also do away with other deductions, such as those for state income taxes, real estate taxes and miscellaneous deductions?

Romney also noted that the $17,000 isn't for everyone. "And higher income people might have a lower number," he said.

What amount of adjusted gross income in Romney's tax view would make you a higher income person? And just how much less in deductions would these wealthier folks be allowed to deduct?

And isn't this just another way of agreeing with Barack Obama when it comes to 44's stated desire to reinstate the personal exemption phaseout (PEP) and itemized deduction limits (Pease provisions) on high earners?

PEP and Pease, named for former U.S. Rep. Donald Pease, the Ohio Democrat who introduced the legislation that created them, were gradually phased out under the Bush tax cuts and have been off the books since 2010. They are scheduled to return on Jan. 1, 2013.

Standard deduction filers curious, too: Then we have the majority of taxpayers who don't itemize. The Internal Revenue Service says about two-thirds of returns claim the standard deduction amount each year.

The standard deduction is easier to claim -- no math, no extra form, the amount to claim is right on the tax return -- and if you don't have a mortgage or have paid down your home loan, you probably don't have enough expenses to come up with itemized deductions that exceed the standard amount.

For the 2012 tax year, the standard deduction is $5,950 for single filers, $8,700 for heads of households and $11,900 for married couples who file jointly.

Will a Romney tax plan standard deduction amount also be reduced in exchange for a 20 percent lower tax rate? If so, by how much?

Don't expect to get any additional details during tonight's first presidential debate.

The GOP nominee also told the Fox31 reporter Eli Stokols that tax plan specifics would need to be, as Romney's said before, worked out with Congress after his election.

But at least we tax geeks policy wonks now have another number to fiddle with in trying to piece together the Romney tax plan puzzle.

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