Fiscal cliff impact on the marriage tax
Research shows that people who stay married tend to be wealthier than those who stay single or get divorced.
So, now that tax season is here, it's time to figure out penalties versus benefits when it comes to the marriage tax.
A senior analyst at the tax policy center says research has shown that more taxpayers get a tax benefit from being married than pay a tax penalty. However, some couples do end up paying more taxes than before they were married.
For example, a married couple filing a joint tax return could be pushed into a higher tax bracket than if they file individually due to new tax laws enacted as part of the fiscal cliff deal.
The marriage penalty can actually impact lower income families the most.
That's because tax incentives designed to encourage people to work phase out as incomes go up.
So, if you're unsure which category you fall into check out www.taxpolicycenter.org and click on the marriage penalty calculator. It will help you decide whether you or your spouse is subject to the marriage penalty.