Ehrlich on Washington column, September 18, 1997

NEWS FROM Robert L. Ehrlich, Jr. Second Congressional District of Maryland 1407 York Road, Suite 304 Lutherville, Maryland 21093 3 1 5 Cannon House Office Building Washington, D.C. 20515 EHRLICH ON WASHINGTON Week of September 1 8, 1997 By Congressman Robert L. Ehrlich, Jr. ABOLISH THE MARRIAGE TAX Of all the financial challenges faced by married couples in the 1990s, perhaps the least expected and the most unfair is that posed by the U. S. tax code. Let me introduce you to two married couples. The first couple consists of one working spouse earning $75,000 a year and one stay-at-home spouse. The second couple consists of two working spouses, each earning $37,500 a year. Both couples file jointly; both pay the same amount of total income tax to the federal Treasury. Under current law, however, the first couple pays $3,872 less in taxes, while the second couple pays $1,391 more than if each spouse had filed as unmarried individuals. What I am describing, the “marriage tax,” punishes millions of working couples in America each year. Ironically, with the break-up of the American family linked to societal ills ranging from drug use to poverty, and my House colleagues and I working to implement pro- family policies, this strange discrepancy in the tax code serves as a disincentive to marriage. Here’s how the marriage tax works: longstanding IRS regulations push many married couples into higher tax brackets. It inadvertently taxes the income of the families’ second wage earner — often the woman’s salary — at a much higher rate than if that salary were taxed only as an individual. c For example, an individual with an income of $24,000 would be taxed at 1 5 percent. But