why do married ppl (MFJ) have more favorable rates and deductions when filing tax returns than those that are Single/MFS status?
They don’t if you consider a husband and wife who each earn the same income. They will pay more taxes and be excluded from more deductions than they would if they were single. Hence, the ‘marriage penalty’
+1, learned that in my tax class too, such BS
However, generally married couples have lower expenses then single people: 1) Shared Accommodation, bills, food, etc 2) As a guy less expense paying for dates with dumb broads
pacmandefense Wrote: ------------------------------------------------------- > why do married ppl (MFJ) have more favorable rates > and deductions when filing tax returns than those > that are Single/MFS status? Government is using the tax code to promote certain behavior. They do it all the time. It is believed that the nuclear family is postive for society so they give tax breaks to those that live the lifestyle. Also, pretty sure the marriage penalty is gone now. My firm prepares lots of tax returns and it is almost never beneficial to file single.
There is a marriage penalty for household income over $137,050 for 2009. Consider two single people, earning 80k each. Marginal rate is 25% for both. If those two get married, their marginal rate is 28%. The penalty is larger as incomes increase.
mwvt9 Wrote: ------------------------------------------------------- > pacmandefense Wrote: > -------------------------------------------------- > ----- > > why do married ppl (MFJ) have more favorable > rates > > and deductions when filing tax returns than > those > > that are Single/MFS status? > > Government is using the tax code to promote > certain behavior. They do it all the time. It is > believed that the nuclear family is postive for > society so they give tax breaks to those that live > the lifestyle. > > Also, pretty sure the marriage penalty is gone > now. My firm prepares lots of tax returns and it > is almost never beneficial to file single. Good point!!! Just looked in tax tables and making $40k as single you would pay almost exactly half of what couple would pay making 80K. The penalty is 6 dollars per couple in my example.
Not to mention the itemized reduction reduction. At $125k each (for instance) singles don’t have there item ded’s reduced. If married and $250k, then item reductions reduced at a fair clip (1% over about $160k for now, but changing in 2010/11 under new admin depending on what passes through).
what type of positive behavior does a MFJ filer do that a Single filer doesnt? and why is there a penalty (lower standard deduction) for filing MFS?
apparently…lower consumption of resources “Showering together will cut your water bill, although if your bathroom is small, some dexterity may be required.” http://www.usatoday.com/money/perfi/columnist/block/2003-03-03-ym_x.htm