Most couples view their wedding day as a milestone of love and commitment, but for the Internal Revenue Service (IRS), it marks a fundamental shift in your legal identity. The moment you say “I do,” you lose the ability to file your taxes as a single individual. This change doesn’t just alter the paperwork you sign every April; it can swing your total tax liability by thousands of dollars. Depending on how much you and your spouse earn, you will likely encounter either a marriage tax bonus or a marriage tax penalty.

Understanding these concepts allows you to plan your household budget more effectively and avoid unpleasant surprises when filing your return. While tax laws have evolved to minimize the “penalty” aspect for many middle-class Americans, the way your combined income interacts with tax brackets, deductions, and credits remains complex. You need to know where you stand before the tax deadline looms.

Defining the Marriage Tax Bonus and Penalty

A marriage tax bonus occurs when a couple pays less in total income tax as a married unit than they would have paid if they had remained single. This typically happens when one spouse earns significantly more than the other. In this scenario, the lower-earning spouse “pulls” some of the higher earner’s income into a lower tax bracket, effectively reducing the overall tax rate for the household.

Conversely, a marriage tax penalty happens when a couple pays more in taxes together than they would have as two single filers. This most frequently impacts two high earners or low-income couples who qualify for the Earned Income Tax Credit (EITC). When their incomes are combined, they may be pushed into a higher tax bracket or lose eligibility for certain credits and deductions that they would have received individually.

“Love is a many-splendored thing, but it’s also a financial arrangement. You must understand how your union changes your relationship with the government.” — Suze Orman, Personal Finance Expert

How Tax Brackets Create the Bonus Effect

The U.S. uses a progressive tax system, meaning as you earn more, the “next dollar” you earn is taxed at a higher rate. For the vast majority of Americans, the current tax code is designed to favor marriage. Under the Tax Cuts and Jobs Act (TCJA) of 2017, the tax brackets for married couples filing jointly are exactly double the brackets for single filers—at least until you reach the very top of the income scale.

Consider a scenario where Spouse A earns $100,000 and Spouse B earns $10,000. If they were single, Spouse A would see a significant portion of their income taxed at the 22% or 24% rate. However, by joint filing, their combined $110,000 income is evaluated against the much wider married filing jointly brackets. This allows more of Spouse A’s high income to be taxed at the 10% and 12% rates that Spouse B wasn’t fully utilizing. This shift results in a substantial marriage tax bonus.

According to data from the Tax Policy Center, roughly half of all married couples receive a bonus, while a smaller percentage—often those with very high or very similar incomes—face a penalty.

When the Marriage Tax Penalty Strikes

If the tax brackets are doubled for married couples, why does a penalty still exist? The “penalty” usually appears in two specific areas: the very top tax bracket and the calculation of certain credits and deductions.

For high earners, the 37% tax bracket does not double. In recent tax years, the 37% rate applied to single filers earning over $609,350. For married couples filing jointly, that same 37% rate kicked in at $731,200. Notice that $731,200 is nowhere near double $609,350. If two high-earning professionals each make $500,000, they would both be in the 35% bracket as single people. Once married, their combined $1 million income pushes a massive chunk into that 37% bracket, creating a clear marriage tax penalty.

Another common penalty trap involves the Salt (State and Local Tax) deduction. Currently, the IRS limits this deduction to $10,000. Crucially, this $10,000 limit applies to single filers AND to married couples filing jointly. If you and your spouse each have $10,000 in deductible state taxes, you lose $10,000 of potential deductions the moment you get married, because your combined limit stays at the $10,000 cap.

The Impact of the Standard Deduction

Your filing status determines your standard deduction—the flat dollar amount that reduces the income you’re taxed on. For most couples, the math is straightforward: the married filing jointly deduction is exactly double the single deduction. In 2024, for example, the single deduction was $14,600, while the joint deduction was $29,200. This parity helps eliminate the penalty for many households.

However, you must consider how this interacts with your actual expenses. If you and your spouse both have high mortgage interest or charitable contributions, you might find that your combined expenses don’t exceed the $29,200 threshold as easily as your individual expenses would have exceeded the $14,600 threshold. You can find more details on current deduction limits at the Internal Revenue Service (IRS) website.

The Hidden Penalty: Student Loans and IDR Plans

One of the most significant modern “marriage penalties” isn’t found in the tax brackets themselves, but in how your tax return affects your student loan payments. If you are on an Income-Driven Repayment (IDR) plan, such as the SAVE plan or IBR, your monthly payment is calculated based on your Discretionary Income.

When you file a joint tax return, the loan servicer looks at your combined Adjusted Gross Income (AGI). If your spouse earns a good living but has no student loans, their income will still be used to calculate your monthly payment. This can cause your student loan bill to skyrocket from $100 a month to $800 a month overnight. In these cases, the “tax” you pay is actually a higher loan payment. You can research repayment options and calculators via the Consumer Financial Protection Bureau (CFPB).

Comparing Filing Statuses

Choosing the right status requires running the numbers both ways. While “Married Filing Jointly” is the most common choice, “Married Filing Separately” is a valid legal option that can sometimes save you money in specific circumstances.

High Earners and the Net Investment Income Tax (NIIT)

If you are a high-income couple, you need to watch out for the Net Investment Income Tax (NIIT). This is a 3.8% tax that applies to individuals with investment income who have modified adjusted gross income (MAGI) over certain thresholds. For single filers, the threshold is $200,000. For married couples filing jointly, the threshold is $250,000.

Note the math here: $250,000 is significantly less than double the $200,000 single threshold. If two people each earn $150,000 in wages and have capital gains from stocks, they would pay no NIIT as single filers. Once married, their $300,000 combined MAGI triggers the 3.8% tax on their investment income. This is a classic example of a marriage tax penalty that targets successful investors and high-earning professionals.

Common Mistakes to Avoid

Managing taxes as a couple requires communication and foresight. Many couples fall into traps by simply doing what they’ve always done without considering their new status.

• Ignoring Withholding Adjustments: When you get married, you should both update your Form W-4 with your employers. If you both work and check the “Married Filing Jointly” box without adjusting for the other spouse’s income, you might not have enough tax withheld throughout the year. Use the IRS Tax Withholding Estimator to get this right.
• Missing the Student Loan Connection: As mentioned, filing jointly can drastically increase student loan payments. Always calculate the “tax savings” of filing jointly versus the “loan increase” before making a decision.
• Forgetting About Credits: If you file separately, you disqualify yourself from the Earned Income Tax Credit and the Credit for the Elderly or the Disabled. Make sure the benefits of filing separately outweigh these losses.
• Assuming Community Property Doesn’t Matter: If you live in a community property state (like California, Texas, or Washington), filing separately is much more complicated. You generally must split all community income 50/50, which often negates the benefits of filing separately.

Professional vs. Self-Guided: When to Call an Expert

While software can handle a basic “joint vs. separate” comparison, certain life situations demand a professional eye. A Certified Public Accountant (CPA) or Enrolled Agent can provide nuance that an algorithm might miss.

Use Tax Software If:

• Your only income is from W-2 wages.
• You take the standard deduction.
• You do not have significant investment portfolios or business ownership.
• You do not have student loans on income-driven plans.

Consult a Professional If:

• One or both of you own a business (especially a pass-through entity like an LLC or S-Corp).
• You are dealing with a complex divorce or separation but are still legally married.
• You have significant medical expenses that might be deductible if you file separately.
• You live in a community property state and want to explore filing separately.

The Marriage Penalty and Low-Income Filers

It is a common misconception that the marriage penalty only affects the “rich.” Some of the harshest penalties occur at the lower end of the income spectrum, specifically regarding the Earned Income Tax Credit (EITC). The EITC is a refundable credit for low-to-moderate-income working individuals and couples, particularly those with children.

The income thresholds for the EITC do not double for married couples. For example, a single parent with two children might qualify for a significant credit. If they marry someone who also earns a modest income, their combined income might push them past the EITC phase-out limit. This results in the loss of a credit worth several thousand dollars—a devastating penalty for a family trying to gain financial footing.

“The tax code should not be a barrier to marriage, yet for many low-income families, the loss of credits like the EITC acts as a literal ‘tax’ on their union.” — Insight from the National Endowment for Financial Education (NEFE)

Practical Steps to Navigate the Tax Season

You can take control of your tax bill by being proactive. Do not wait until April to see how your filing status affects you. Follow these steps to ensure you’re making the most of the marriage tax bonus or mitigating the penalty:

1. Run a Pro-Forma Comparison: Most tax software allows you to “mock up” a return. Create one as Married Filing Jointly and another as Married Filing Separately. Compare the bottom line.
2. Review Your Credits: List the credits you usually claim (Child Tax Credit, Education Credits, etc.). Check the IRS rules to see if filing status affects your eligibility.
3. Check Your State: Remember that your federal choice usually dictates your state choice. In some states, the marriage penalty is more pronounced at the state level than the federal level.
4. Coordinate Your Deductions: If you file separately, and one spouse chooses to itemize, the other spouse must also itemize, even if their individual deductions are $0. This requires total coordination.

Frequently Asked Questions

Can we choose to file as “Single” if we are married?
No. If you are legally married on December 31st of the tax year, the IRS considers you married for the entire year. Your only options are Married Filing Jointly or Married Filing Separately (or Head of Household in very specific, limited separation cases).

Does getting married always lower my taxes?
Not necessarily. While many people receive a “marriage bonus” because one spouse earns more than the other, two high earners or two very low earners may see their tax bill stay the same or increase due to the “marriage penalty.”

Is the marriage penalty still a big deal after the 2017 tax reform?
The TCJA eliminated the penalty for most middle-income earners by doubling the tax brackets. However, the penalty still exists for those in the 37% bracket, those affected by the SALT deduction cap, and those qualifying for the EITC.

What if we got married on December 31st?
The IRS views your marital status on the last day of the year as your status for the entire year. Even if you were single for 364 days, you must file as a married person for that tax year.

Your Path Forward

Navigating the marriage tax landscape requires you to move past myths and look at your specific data. For most American couples, marriage acts as a financial shield, offering a bonus that reduces the household’s effective tax rate. If you find yourself in the minority facing a penalty, remember that the “cost” of marriage is often offset by other legal and financial benefits, such as Social Security survivor benefits and simplified estate planning.

Take the time this week to look at your last two pay stubs and your most recent tax return. If your incomes are vastly different, prepare for a bonus. If you both earn high six-figure salaries or rely heavily on the EITC, prepare to strategize. By understanding how the marriage tax penalty and bonus work, you turn a complex legal requirement into a manageable part of your joint financial life.

The information in this guide is meant for educational purposes. Your specific circumstances—including income, debt, tax situation, and goals—may require different approaches. When in doubt, consult a licensed professional.

Last updated: February 2026. Financial regulations and rates change frequently—verify current details with official sources.