Kaplow, Louis2014-05-191991Louis Kaplow, The Income Tax as Insurance: The Casualty Loss and Medical Expense Deductions and the Exclusion of Medical Insurance Premiums, 79 Cal. L. Rev. 1485 (1991).0008-1221http://nrs.harvard.edu/urn-3:HUL.InstRepos:12207434Whether personal income tax deductions are appropriate refinements to the concept of income or are unwarranted tax expenditures continues to be the subject of debate. The casualty loss and medical expense deductions are frequently justified on the ground that largely unavoidable losses or expenditures reduce one's ability to pay taxes. This Article reconsiders the question, taking into account the availability of private insurance, which is widespread for relevant losses in both areas. The author argues that when individuals can insure, the second level of insurance implicit in the casualty loss and medical expense deductions has undesirable effects on consumption choices and insurance decisions. In particular, individuals may be more exposed to losses because of tax deductions commonly believed to mitigate them. He concludes that, given the option, individuals would prefer a regime that eliminated the deductions and offered correspondingly lower tax rates.en-USJournal Article