Number: RL30817
Title: FEDERALISM THROUGH TAX INTERDEPENDENCE: AN OVERVIEW
Authors: Steven Maguire, Government and Finance Division 
Abstract: To clarify the role of taxes in the fiscal relationship between the levels of government, this report analyzes selected components of the federal tax code that directly affect state and local government finances. After a discussion of tax expenditures generally, four instruments are analyzed in turn. The first are tax-exempt bonds- stand and local government bonds-the interest payments on which are exempt from federal income taxation. The second is the federal estate tax credit for state death taxes. The third and fourth are federal income tax deductions for state and local taxes on property, and income, respectively.
Pages: 13
Date: Updated January 25, 2001