ECON 200 Lecture Notes - Lecture 9: Adjusted Gross Income, Marriage Penalty, Externality
13 Oct 2016
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Document Summary
Some types of income are not taxed at all. Your taxes might go up if you get married (marriage penalty) or they might go down if you get married (marriage bonus) Many people have argued that your taxes should not depend on whether or not you are married, i. e. , the income tax should be marriage neutral. Want to try to convince that you cannot create a tax system that meets three principles. The family is the appropriate unit of taxation. 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 different incomes marry. Marriage penalties occur when two individuals with equal incomes marry. 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.
