10 Tax Tips for Married Couples

Marriage Tax Penalty or Bonus
If you’ve heard scary stories about the marriage tax penalty, good news: It’s a thing of the past. © foto-ruhrgebiet/iStockphoto

You may have heard tell about a marriage tax penalty. Back in the day, it was spoken about in hushed tones and back rooms, like a discussion of the boogeyman. The penalty worked like this: If both spouses had jobs and filed taxes jointly, their combined income was taxed at a higher rate than if they had filed separately or if they were earning the same amount of money as singles. Congress did away with this penalty, however, for the lower and middle tax brackets, and now couples are more likely to get a marriage bonus -- which means they pay less in taxes by filing jointly than they would have as singles. This bonus is greatest when one spouse earns considerably more than the other: Filing jointly can bring the higher earnings into the lower earner's tax bracket.