House Approves Bill to Phase Out Marriage Penalty
... One example of this is the so called “marriage penalty” that is in place. The marriage penalty is highly criticized by taxpayers. In 2001, the House of Representatives began a phase out of this “marriage penalty. ... The “marriage penalty” can arise when a married couple files a joint return. ... On the other hand, the “marriage bonus” arises when the opposite is true. ... Last year, 25 million couples filing jointly paid $28 billion more in taxes because of the marriage penalty. ... Another 25 million couples receive a marriage bonus.2 Both the “marriage penalty” and the “marriage benefit” arise today and the issues surrounding them are constantly debated. The bill in question, passed by the House of Representatives would not totally fix the “marriage penalty.” The proposed doubling of the standard deduction for married taxpayers as opposed to the single rate would in fact not have much of an impact on the penalty as a whole. ... However, the marriage penalty still exists because a married couple can still be bumped out of their single bracket and placed into a higher bracket. The “marriage penalty” would still exist and may not have any benefit to the taxpayers. The current bill in question is addressing the issue of the “marriage penalty” but in no large way solving it. ... The only way the bill would affect those taxpayers who itemize their deductions is that the standard deduction has increased so those who’s itemized deductions were already close to that of the standard deduction may now take the standard deduction instead.