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  • Writer's pictureSchoelles and Associates

ICYMI | The Status of the ‘Marriage Penalty’ An Update from the Tax Cuts and Jobs Act

One of the objectives behind a progressive income tax structure is to achieve a redistribution of wealth by imposing higher taxes on those who earn more compared to those who earn less. Tax laws are therefore written to tax higher incomes at rising rates with fewer exemptions. Due to this structure, married couples filing jointly may end up with a higher joint federal income tax liability compared to what they would incur collectively if they remained single and filed as single individuals. This “marriage penalty” exists if both spouses have fairly similar taxable incomes. It is worth noting that the marriage penalty “is not a statutory item in the tax code but rather arises from other provisions of the tax law” (Leslie A. Whittington and James Alm, “Tax Reductions, Tax Changes, and the Marriage Penalty,” National Tax Journal, September 2001,

The issue of the marriage penalty arose decades ago; several times, the government has offered relief to married couples by increasing deductions, raising the starting point of each tax bracket, offering credits, or changing other rules. Major tax legislation of the last two decades—such as the Taxpayer Relief Act of 1997, the Economic Growth and Tax Relief Reconciliation Act of 2001, the Jobs and Growth Tax Relief Reconciliation Act of 2003, the Working Families Tax Relief Act of 2004, the American Recovery and Reinvestment Tax Act of 2009, and the American Taxpayer Relief Act of 2012—all tried to eliminate the marriage penalty, but managed to only alleviate it. The newly enacted Tax Cuts and Jobs Act of 2017 (TCJA) is not much different.

This article demonstrates that, while the TCJA has offered some relief to married couples filing jointly by either eliminating or minimizing the marriage penalty in a few areas, the penalty persists in other areas. It describes how the penalty worked prior to the TCJA, especially when couples had similar amounts of income, and analyzes the provisions of the TCJA to show where the marriage penalty no longer exists, where it has been diminished, and where it persists.

  1. What is the Marriage Penalty? “A marriage penalty results when a married couple pay[s] more taxes by filing jointly than they would pay if each spouse could file as a single person … The marriage penalty fundamentally results from progressivity of the Tax Code” (Bruce R. Bartlett, “Tax Reform: Doing Away with the Marriage Tax Penalty,” Vital Speeches of the Day, April 1998, The reason more people are experiencing the marriage penalty in recent years may be partly that both the percentage of women in the work-force and women’s earnings...

Story courtesy of

CPA Journal - February 13, 2020


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