The Biggest Marriage Tax Is the Hardest One to Solve

Though not as often discussed, the biggest "marriage penalty" of all clearly stems from the "earned-income tax credit." This tax rebate for lower income working families is computed and phased down exactly the same for single parents as for married couples with children. For example, two cohabiting single parents each making $15,000 can get as much as $2,870 apiece in tax rebates. But if they marry, their tax rebates are eliminated. As a result, in the worst cases, two-earner couples with four children and a joint income of between $20,000 and $35,000 can face marriage penalties exceeding $5,000. Other EITC marriage penalties are less gigantic, but they can hit some two-job married couples who have children and are making up to $50,000 with thousands of dollars in added taxes just for being married.

Eliminating EITC marriage penalties could be prohibitively costly--$20 billion to $25 billion a year--unless offset by some pretty hefty tax hikes on a lot of the modest income single parents the program is mainly intended to help, and it would probably make the EITC program even harder to administer. It's worth noting, however, that congressional Republicans who want to spend even larger sums--with no offset--to reduce marriage penalties on the highest income married people haven't entertained the idea of targeting marriage penalty relief at couples in the middle of the income scale.