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1 Kyle Pomerleau, Understanding the Marriage Penalty and Marriage Bonus 1 (2015)

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FOUNDATION

FISCAL

FACT
Apr. 2015
No. 464


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Understanding the Marriage Penalty


and Marriage Bonus


By  Kyle   Pomerleau'
    Economist


Key   Findings

*   A marriage penalty  or bonus is the change in a couple's total tax bill as a
    result of getting married and thus filing their taxes jointly.


 *  Marriage  bonuses  typically occur when two  individuals with disparate
    incomes  marry.


 *  Marriage  penalties occur when  two  individuals with equal incomes marry;
    this is true for both high- and low-income couples.


 *  Marriage  bonuses  can be as high as 20 percent of a couple's income, and
    marriage penalties can be as high as 12 percent  of a couple's income.


 *  While research  shows  that marriage penalties and bonuses   do not have
    much  effect on whether  a couple will marry, they do impact how  much
    each spouse  works.


 *  It is possible to completely eliminate both marriage penalties and bonuses,
    but it would require a significant overhaul of the tax code that drastically
    changes  the current distribution of income taxes paid.


1  The author worked with Nick Kasprak of the Center on Budget and Policy Priorities to develop the data for this report.

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