Marriage Tax Penalty and Unit of Taxation

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The marriage tax penalty refers to the fact when two people marry, they pay more taxes than they do when they are single. This happens when the two persons have roughly the same income.

The mirror image of the marriage tax penalty is the marriage tax bonus, that is when two spouses have disparate income or one spouse decides to stay at home, they pay less tax than they do if they don’t marry.

I touched on the topic of marriage tax penalty in two previous posts: » Read more …