In my column this week, I point out that any meaningful reform of the U.S. tax system will require taking a hard look at the special benefits benefitting specific groups. If these so-called tax expenditures were counted as spending each year, they would exceed the cost of Medicare, or Social Security, or defense or all the discretionary domestic spending programs.

There are about $1.1 trillion of tax preferences, according to the latest figures compiled by the Congressional Committee on Taxation, with the most generous benefits going to investors. The lower rates on capital gains and dividends are worth $160.8 billion a year and the exclusion of capital gains taxes at death amounts to $42.8 billion.

There are tax preferences that primarily benefit working-class or middle-class Americans, including the earned-income tax credit, at $60.9 billion a year, and the $57.3 million annual tax credit for children under 17.

Most of the bigger tax expenditures, such as preferences for pension plans, state and local and property taxes and home-mortgage interest deductions tilt decidedly toward upper-income taxpayers.

The $69.7 billion a year write-off for interest on home mortgages is often depicted as a benefit allowing the middle class to realize the American dream of home ownership. In reality, it benefits the wealthy much more. The liberal Center for Budget and Policy Priorities recently offered an illustration: An investment banker making $675,000 a year with a $1 million home mortgage pays $40,000 in interest and gets a $14,000 tax break; a nurse making $60,000 and paying $10,000 in interest gets a $1,500 break.

Even the percentage of the banker's interest expenses covered by the subsidy is more than twice as large as that of the nurse. Actually, with the increase in the top rate approved in January the investment banker's subsidy would be a little larger.

(Albert R. Hunt is a Bloomberg View columnist. E-mail him at ahunt1@bloomberg.net or follow him on Twitter.)