[QUOTE=Cyberhwk]
Yeah. I’m SINGLE but have two different W-2s this year. I had almost a $1000 return when I was half finished (my second W-2 was late). I was pumped about finally getting a decent return instead of the $200-$300 I usually get. So I added my second return…dropped my return to $325. Same as last year. 
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Progressive taxation in action.
[QUOTE=Rocketeer]
Penalty or no, there’s an advantage for a society to reward marriage–it stabilizes young men, and keeps them from running riot. Same reason you want high employment.
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I thought the advantage was to stabilize the young women running riot and plopping out babies society will have to pay for, if we can’t saddle a man with the bill.
[QUOTE=Antinor01]
Does anyone have an example of the ‘marriage penalty’ in action? I’ve run numbers based on the IRS tax table for several situations and have yet to find one where married filing jointly comes out with a higher tax than two singles. Such as, total of 60K taxable income, married FJ tax is 8221. Single tax rate on 30K x 2 is 8226. Single rate for 20k and 40k combined is 9043. Married FJ comes out ahead. I’m having similar results with other permutations. This is only based on the tax table and obviously isn’t taking into account any deductions or other things, but so far I’m not seeing it. Can anyone help me out here?
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No, because you’ve discovered the truth–except for a few people with very high incomes, the marriage penalty no longer exists. The OP is simply mistaken, although it’s impossible to prove it without access to his tax return. See gfactor’s quotes above, or for a simpler explanation see good old wikipedia.
Elimination of the marriage penalty of course leaves us with a singles penalty, since it’s impossible to design a progressive tax system that treats three categories of taxpayers (single, married with equal incomes, married with disparate incomes) with the same total income the same way. You don’t hear much agitation about it, because the majority of single people imagine that they will one day be married.
[QUOTE=Freddy the Pig]
No, because you’ve discovered the truth–except for a few people with very high incomes, the marriage penalty no longer exists. The OP is simply mistaken, although it’s impossible to prove it without access to his tax return. See gfactor’s quotes above, or for a simpler explanation see good old wikipedia.
Elimination of the marriage penalty of course leaves us with a singles penalty, since it’s impossible to design a progressive tax system that treats three categories of taxpayers (single, married with equal incomes, married with disparate incomes) with the same total income the same way. You don’t hear much agitation about it, because the majority of single people imagine that they will one day be married.
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Thanks. I was starting to wonder what I was possibly missing.
[QUOTE=Freddy the Pig]
You don’t hear much agitation about it, because the majority of single people imagine that they will one day be married.
[/QUOTE]
That and single people have absolutely 0 political clout.
[QUOTE=Rocketeer]
Penalty or no, there’s an advantage for a society to reward marriage–it stabilizes young men, and keeps them from running riot. Same reason you want high employment.
[/QUOTE]
Yeah, I’m not married and the number of convents and orphanges I burned last year must have pushed triple digits!
-Joe
[QUOTE=Freddy the Pig]
…since it’s impossible to design a progressive tax system that treats three categories of taxpayers (single, married with equal incomes, married with disparate incomes) with the same total income the same way.
[/QUOTE]
I’ve always wondered why we couldn’t have a married couple average their incomes and each file that amount with all the same rules as though they were each single. Wouldn’t this completely eliminate all married vs single tax disparities?
[QUOTE=flex727]
I’ve always wondered why we couldn’t have a married couple average their incomes and each file that amount with all the same rules as though they were each single. Wouldn’t this completely eliminate all married vs single tax disparities?
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No, because then a married person making $100k with a stay-at-home spouse will pay hugely less than a single person making $100k, even if the single person has an unmarried dependent.
[QUOTE=Freddy the Pig]
No, because then a married person making $100k with a stay-at-home spouse will pay hugely less than a single person making $100k, even if the single person has an unmarried dependent.
[/QUOTE]
A married person making $100k with a stay-at-home spouse ALREADY pays hugely less than a single person making $100k.
[QUOTE=flex727]
A married person making $100k with a stay-at-home spouse ALREADY pays hugely less than a single person making $100k.
[/QUOTE]
And your proposal would do nothing to rectify that.
[QUOTE=acsenray]
I don’t think either of us has a withholding rate that would result in taxes owed if we had filed separately. So, even if there is a difference, that still shouldn’t subtract from my refund amount.
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What happens is that deductions are taken from your paycheck with the assumption that you are the only wage earner and this is the only job that will appear on your tax return.
So that means if you make $60,000, the withholdings are done assuming the first $15K will be taxed at 10% and the remaining $45K will be taxed at 15%.
If your wife makes $40,000, her withholdings are done assuming the first $15K will be taxed at 10% and the remaining $25K withheld at 15%.
So in the end, you’ve had $30K withheld at 10% and $70K withheld at 15%. But, together you made $100,000 and the tax brackets for $100K for married couples break out like (rounded):
up to $15K - 10%
$15-65K - 15%
65K-130K - 25%
So you should have paid 10% on $15K, then 15% on 50K, then 25% on the remaining $35K, but you have come up short. If either of you were the only wage earner, you would not have come up short because the withholdings would have been calculated correctly.
Form W-4 has a worksheet to help you solve this problem by adjusting the assumptions about your taxable income that are made when withholdings are calculated.
[QUOTE=levdrakon]
I thought the advantage was to stabilize the young women running riot and plopping out babies society will have to pay for, if we can’t saddle a man with the bill.
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Arguably, one could claim that we want to encourage marriage between people with disparate enough incomes that one of them would be on the dole without spousal support, and not encourage marriage between two high-earners… which is exactly what the current system does. 