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None of this should be surprising, ceteris paribus.
The married couple have the potential for two incomes, while the single only has the one. While one may not work, that person can presumably go back to work if times get tough.
If a single is out of work, that person has no income (not counting UI, severance, etc.). If one person in a married couple is out of work, the "healthy" one can pick up the "injured" one until they get back on track.
The same thing can apply for child care, health needs, etc.
If spouse A is in the 25% bracket, the first dollar spouse B makes is taxed at 25%.
Married rates are not double single rates, that's the penalty. It exists, I pay it, and it's clear as day.
Again you didn't answer the question I asked. I know you are educated so you should be able to understand not only the difference between marginal and effective rates but also the marriage penalty has largely been fixed. Higher dual earners pay a little more, one high earner and one lower earner actually benefit. I'm not sure you understand how the marriage pentaly/bonus actually works. I provided you multiple examples already
It was not a surprise to me but many people think singles have tons of money. Our church pastor told the singles group they should be putting more money into the collection plate because they don't have the burden of marriage. Which doesn't make sense to me.
I'm sure he has reasons married people should put more into the collection plate too.
A union of two frugal people - whether married or "cohabiting" - can be financially very wise. Unfortunately, the tighter the union, the greater the catastrophe if the union unravels. The very same thing that bestows upon us the greatest joys, elation and benefits - is also the most hurtful, in teh event of failure.
Quote:
Originally Posted by Lowexpectations
... If incomes are evenly matched its usually a negative but if there is a big spread it can often be a bonus.
The bonus is especially high, if a high-earning individual marries a person without an income. Then the high-earner can receive a huge deduction. This is especially true in states like California, where for some reason the marginal state income tax rate is much higher for single filers, than for married ones.
Quote:
Originally Posted by LeavingMA
...Divorce will always hurt the saver in the relationship.
Indeed; especially if the saver was the more affluent one, and not merely the thriftier one. Just as marriage rewards (in terms of taxes) a marriage of financial un-equals, so too, divorce penalizes the same.
A union of two frugal people - whether married or "cohabiting" - can be financially very wise. Unfortunately, the tighter the union, the greater the catastrophe if the union unravels. The very same thing that bestows upon us the greatest joys, elation and benefits - is also the most hurtful, in teh event of failure.
[ ]The bonus is especially high, if a high-earning individual marries a person without an income. Then the high-earner can receive a huge deduction. This is especially true in states like California, where for some reason the marginal state income tax rate is much higher for single filers, than for married ones.[/b]
Indeed; especially if the saver was the more affluent one, and not merely the thriftier one. Just as marriage rewards (in terms of taxes) a marriage of financial un-equals, so too, divorce penalizes the same.
This is true and the largest pentaly is actually for low earners who earn relatively the same amount. I want to say around 17k each ends up with the worst pentaly
They're wealthier. Period. 2 income households became essentially necessary in the eighties. Required nowadays. And for retirees, those survivor bennies are not huge but a plus! That's really why the gay marriage thing. Just because you're homo why should you get less SS? Raising kids isn't the answer - funding that? that's YOUR business. Hetero married childless people get survival bennies too. Single people without survival status should get double SS. SS payout should have nothing to do with your reproductive proclivities.
And lets face it, the "little lady" has been out of the laundry room and kitchen for decades.
This is true and the largest pentaly is actually for low earners who earn relatively the same amount. I want to say around 17k each ends up with the worst pentaly
Lower tax brackets (federal) are half for single so it doesn't matter. It's only the 25% bracket where there is a marriage advantage/penalty. In mismatched salaries, there's still small penalty for a low earner and a larger advantage for the high earner. Marriage penalty is really exaggerated though. Brackets just aren't that progressive at lower incomes that still technically have a slight marriage penalty. Two people earning $90k each get a small amount taxed at 28% instead of taxed at 25%. /Yawn. That's not the marriage penalty. The marriage penalty is two people earning, say, $400k. It's not so trivial at that point and you're talking real money, even to someone making $400k/yr.
California's brackets are all 50% for single so it doesn't matter. Again, there's the advantage/disadvantage for unequal salaries, but two relatively equal ones it's irrelevant. No advantage, no disadvantage.
Lower tax brackets (federal) are half for single so it doesn't matter. It's only the 25% bracket where there is a marriage advantage/penalty. In mismatched salaries, there's still small penalty for a low earner and a larger advantage for the high earner.
California's brackets are all 50% for single so it doesn't matter. Again, there's the advantage/disadvantage for unequal salaries, but two relatively equal ones it's irrelevant. No advantage, no disadvantage.
This is simply untrue. EITC is a major part of the marriage penalty for low earners even when their incomes are similar
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