Making the Child Tax Credit more meaningful for the working class; Eliminating
marriage penalties in the tax code; and Promoting paid family leave.
Existing research primarily relies on hypothetical situations to document EITC
marriage penalties, with little empirical work exploring penalties based on real-life situations.
especially, might face larger
marriage penalties in 2013 than they had in 2010.
Instead, the current regime would in fact exacerbate
marriage penalties and marriage bonuses.
Observers note that some couples might prefer to retain state protections respecting community property (tenancy by the entirety), healthcare provisions and insurance benefits, while circumventing
marriage penalties under federal tax law.
Defining and measuring
marriage penalties and bonuses.
Also
marriage penalties, marriage bonuses, passive investment rules, divorce property settlements and preferential treatment of donations to charitable organizations of securities and cash versus other assets--all are discriminatory, he says.
63-68); greatly reduce
marriage penalties by giving married taxpayers a tax rate schedule with brackets twice as wide as those applicable to single taxpayers and by giving married taxpayers a "family credit" twice as large as a single person's credit (p.
To illustrate
marriage penalties and bonuses more precisely, consider the following hypothetical couples.
They calculate
marriage penalties and reductions in marriage bonuses using alternative approaches and assumptions, with the Treasury Department's micro-simulation model.
The proposal is an effort to fulfill a range of aims: general, progressive tax relief; tax simplification; enhancement of work incentives; and reduction of
marriage penalties.
This U-shaped pattern of benefits by income, which Ellwood and Liebman call the "middle-class parent penalty," not only raises issues of fairness, it also generates high or higher marginal tax rates and
marriage penalties for moderate income families than for more well-to-do taxpayers.
